Terrapin - Welcome back - BEBE - looked at it after seeing your post. Looks real attractive in rear view mirror - the financials, earnings, growth would seem to justify way better share price. Problem is that growth has stalled based on same store sales from 20 - 30% last year to recently announced negative for March. Margins are also under pressue. Three top execs have departed [Marketning, merchendising, & today - retail operations] - a strain on a small co & a possible sign of deepening problems. Shorts clearly expect continued problems: 85% of small float [10% of cap] is shorted. I respect the deeper analysis work often done by shorts, but good news - if there ever is any, could spark a rally/squeeze due to thin float. I've seen some discussion of a secondary, but could find no confirmation in the SEC docs.
BEBE has a very narrow focus, young thin women, so a shift in fashion preferences, could be ugly. Maybe that's why many of their managers are jumping ship.
Even if I had a really good feel for ladies fashion, I'd probably be on the sidelines due to the management exodus. As it is, I have no feel for fashion whatsoever, and am thus rather reluctant to bet on something with key metrics on the decline despite very attractive valuation based on recent history.
bob |
