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Non-Tech : Just For Feet (FEET) -- Ignore unavailable to you. Want to Upgrade?

To: Don Dorsey who wrote (460)	12/29/1997 12:31:00 AM
From: Walter High	Read Replies (1) \| Respond to of 750

Don: No question that the company has continued to advance earnings year-to-year. Remember, though, this is a company that pays no dividend, so when people buy the stock, they are betting that they can sell it higher than they bought it since they cannot expect any dividend checks. The earnings growth comes in two forms: (1) increases in same store sales (assuming that costs do not advance at a faster rate), and (2) bringing new stores online at a profit. In the past both (1) and (2) have contributed to FEET's earnings growth. In the past year, same store sales have slowed considerably (note the decreased in same store sales increases from 30+% to 3-5%). Also in the past year, new stores have taken a hit because of the costs associated with the mall-based store acquisitions. There is a limit to how long FEET can continue to build new stores and each year the increase in the earnings contribution is less. For example, adding 25 stores to increase total stores from 50 to 75 is a 50% gain. Adding 25 stores to increase total stores from 200 to 225 is a 12.5% gain. So growth slows inevitably. That leaves the long-term burden for profit generation on the increase in same store sales. With the shoe market looking downward right now, the prospects for same store sales growth are not good. FEET has to prove to the market that it can make the mall-based stores profitable and that same store sales won't go negative. Until that can be determined, the stock price is likely to stay well below 20. My two cents worth, Walter High

To: Don Dorsey who wrote (460)	12/29/1997 2:33:00 AM
From: bigtoe	Read Replies (1) \| Respond to of 750

Don, You post: >> Go back and research the negative writings towards Mcdonalds in the 1970's. They were supposedly overbuilding, its food quality was poor, and agressive new competition was taking their business.<< Jeez Don, is this Deja vu? Your comments exemplify the PRESENT problems with McDonald's, not only the past. But, I don't care about the past. McDonald is currently suffering from "not paying attention" to it's business, and thinking that they don't need to...that is my point. Pissing off your Franchisees is no way to run a business. I don't think the upper management at McDonalds has a clue about it's current standing amidst it's current competition and to berate and pressure your assets (the franchisees, but in FEET's case, it's employees) is simply extolling arrogance instead of leadership. >> Whether management is any good or not, the company and its earnings have grown tremendously...<< That is a silly thing to say, Don. Management should mean everything to someone who is betting on the future of any company. That is what you're doing, right? I think the next typical response from FEET management in this context is " Hey, we were in the fortune magazine fastest growing companies... so what's the problem?..." Well, there is only one small problem...THE STOCK HAS BEEN FALLING FOR A YEAR...AND CONTINUES TO FALL! I suggest you "go back and research" the article from Fortune and read what the author says...not what you want to hear. It is not a complimentary article at all. But nobody at FEET is learning from what the article says. They just wave the FEET flag and say "hey, my salary is great and we have plenty of stockholders money...our growth is tremendous...". Yes. well FEET stock is at an all time low, it's expenses are at an all time high and it's turnover of qualified employees and management tops any retailer, in any retail genre. If "13 will look cheap..." it will be at a tremendous cost to many. regards, Bigtoe