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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Jenna who wrote (44087)	6/11/1999 5:27:00 AM
From: Jenna	Read Replies (1) \| Respond to of 120523

For a no-brainer in case pressure is still in techs: try CLE,SCNYA,SRR,FD,NKE .. SCNYA looks to be shaping up to become another KSWS.. and NKE still is improving. CLE good May sales reports. Thursday May 6, 1:58 pm Eastern Time Saucony Inc. Posts $0.52 vs. $0.16 1Q EPS Saucony SCNYA FS Van Kasper » Buy on June 3, 1999 CLE Thursday June 3, 9:18 am Eastern Time Claire's Stores Says May Same-store Sales Up 13 Pct Just broke through resistance yesterday and 29 5/8, chart can go either way. SRR Report Date: 22-Jun-1999 rumors abound of a buy out by WWW or RBK.. not a long term hold but could be good for a swing trade. news on CLE: FOOL ON THE HILL (May 5, 1999) An Investment Opinion by Louis Corrigan Claire's a Clear Gen Y Winner Did you know when The Spice Girls' popularity began to wane and merchandise covered with butterflies started flying off the shelves? I didn't, but the folks at teen retailer Claire's Stores (NYSE:CLE - news) did. They were prepared for it. Such merchandising smarts, and the sourcing relationships and distribution system needed to respond quickly to such changing tastes, have helped Claire's deftly negotiate a notoriously faddish part of the fashion industry where Jennifer Aniston necklaces become must-haves one month and obsolete trinkets the next. What's ironic is that the catalog firm Delia's (Nasdaq:DLIA - news) , with its newly public iTurf (Nasdaq:TURF - news) online subsidiary, has seduced investors into believing that it's the leading marketer to Gen Y, the baby boomer's baby boom. Yet, the understated Claire's has five times the sales of Delia's, making it one of the companies actually delivering the goods to this bulging market niche, and in highly profitable fashion. Indeed, Claire's has a long history of turning costume jewelry, hair bands, and other accessories only a pubescent girl could love into a high return on equity business. (That's why it was my top pick in the teen retailing sector in the Fool's 1999 Industry Focus.) And after a surprisingly strong fourth quarter that helped the stock recover from a brief funk, Claire's should report terrific Q1 results tomorrow. The company operates 2,082 stores, mainly in the U.S. It did, however, acquire the 53-store Zurich-based Bijoux One chain of fashion accessory stores last November as a base to expand its European operations beyond the U.K., where it runs the Bow Bangles chain. The company crams 7,000 items priced at $2 to $20 into compact mall-based stores called Claire's Boutiques or Claire's Accessories (average size 960 square feet), or its slightly larger stores operating as The Icing or Claire's Etc. (average size 1,375 square feet). Two years ago, the company furthered its controlled expansion into apparel by acquiring Mr. Rags, a U.S. chain selling "skater/urban fashion" apparel and accessories, mainly to male teens. Part of what I like about Claire's is that management, led by octogenarian Chair/CEO Rowland Schaefer and his daughters Marla and Bonnie (both Vice Chair), takes a cautious approach with new initiatives, experimenting but insisting on economic returns. The stock dipped last fall following news that spending on its newly launched Just Nikki:) catalog wasn't translating into expected sales, forcing Q3 earnings to come in below expectations. By January, the company had decided to shut down the operations, recording a pre-tax loss of $4.8 million, or six cents per share, to write-down the investment. The catalog just didn't produce the required return on investment. Such discipline has produced exceedingly cool numbers. For FY99, ended this past January, sales rose 23.3% to $662 million (excluding $14.7 million in sales generated by the shuttered catalog). Income from continuing operations increased 20.2% to $72 million (or, excluding the one-time loss, around $75 million, up 25.3%). EPS excluding the one-time charge increased 28.1% to $1.46 per share. Sales over the last four years have grown at a compound annual rate of 20.1% while earnings per share have increased at a 30.7% annual pace. Return on equity has increased steadily over this period to 26.1% last year as net margins rose to nearly 11.3% last year (excluding the one-time loss). That's despite the fact that lower-margin apparel and non-jewelry accessories have risen in the sales mix, as this table shows.