Last night one of my favorites stocks disappointed. True Religion Apparel (TRLG), a luxury jeans manufacturer, reported lower sales and lower earnings than expected. The company reported 7 cents below estimates, and lower sales in Europe and Japan.
Companies accused the weather and overheating low sales. Worse, they didn't give investors warning, such awful quarter.
Looking at the stock (see chart), the momentum of the people killed.
15 seems to be a good level of support, but a lot of maintenance. In the coming year, an optimistic attitude is $1.11, profit. 20 dollars. Almost no growth than this year's meeting. A good entry price will be low in half. Meanwhile, investors will have to wait for company better results. Or look at the sky and look at the weather will be right, want to buy jeans.
This is the real religious death?
I don't think so. The company has entered a transition period. They have good brand recognition and they are the first in luxurious jeans space. They may have stalled. Now, they have to find new ways to grow. They have plenty of choice:
Man, is to build your own store, it is not likely to increase sales jeans, otherwise they will carrion shop and retail sales. Instead, they will promote the shops, non - denim sales. In fact, the true religion to imitate diesel and success of shoes and other accessories, away from the jeans. Now, non - denim sales, including 20 percent of the income.
Another method to promote growth will build up the brand, the buttocks more attention to child guess (Los Angeles suburbs GES), rather than with the city look, they have now. Then they will fight Abercrombies (said) and Zaras in bazaar. They need a lot of money and a lot of time. Somehow, I think this management don't want to go that way.
Maybe the executives do not like the heat of a public company and rather want to sell or take it private. That could be the reason for Goldman Sachs' (GS) involvement in the company.
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