Fashion For The Run

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Oct 30, 2011
The Retail Industry today is showing more promising gains with the leading retail companies making profits each quarter. Apparel companies are finding that online social marketing is attracting young adults, usually ages 13-21. The companies expanding outside the U.S. through China and European countries are excited to see volatility ranges change, expansion of marketing opportunities, and even hopefully stay on the bull longer with the bucks and turns that you see in our markets do today.


The Retail industry is complex and people do have their doubts but people do not bring in the fact that reading the calendar can even help figure where your stock of your retail company will do. For example, back to school sales or Black Friday usually always bring back higher revenues in those quarter.


Abercrombie and Fitch (ANF, Financial) is my favorite with the company using their products as their advertisements and not paying on commercials or other advertisement strategies. Abercrombie and Fitch has a market cap of $6.6 billion, and a P/E of 34 as the Beta is at 1.62.


Abercrombie sits at $76 and has a 12-month forecast between $85-$90. I believe this bullish company will be here for the long run! Abercrombie’s last four quarters has steadily increased with solid margin numbers.


American Eagle Co. (AEO, Financial) is another in the top three retail stores in the U.S. stock market today. A $2.6 billion market cap with a dividend of .11 and yielding of 3.24.


With a beta of 1.05, American Eagle is financially fit, sitting at $13.57, and a 12-month forecast for the stock is around $17-$19.


American Eagle has expanded marketing ideas and have just recently joined Google Wallet, which is a new upcoming mobile shopping experience that makes shopping online even easier!


Since 2007, American Eagle has had low operating costs with a steady revenue each year. The company has expanded all through the states and plans to open more overseas stores within the next couple of years. I believe that American Eagle will be a great investment once the banking issues resolve in the U.S. and Europe and we can get back into a steady economy.


Urban Outfitters (URBN, Financial) is the bottom of the top three, but don’t let that discourage you. Urban has been around since the 70s and began their issue of common shares in 1994, and the stock took off around 2002. Their market cap is over $4 billion, the beta of .98 and the P/E of 19. Since 2008, annual revenues have significantly increased with operating incomes steadily on the rise. Urban Outfitters marketing skills have came from the bottom of the pile but is currently making their mark on our society. With a few new members to the board will hopefully make this company more bullish as you see more and more advertising in key places and putting more time and effort into key marketing needs of the company.


Showing the potential upside of these companies was well needed as our markets are at bargain prices with money to be made in the near or further futures. The other retailers that are on the down trend would be Pacific Sunwear of California (PSUN, Financial) and Gap Co. (GPS, Financial) with their choices to close multiple stores through the U.S.


Gap Co. has announced they will be opening more stores in China and a few places such as Japan and Korea. Gap Co. is a definite stock to watch, but the company has some repairs to make before it will become bullish again.