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Avon Products Inc. Message Board

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  • p8iano p8iano Nov 1, 2012 3:53 PM Flag

    Potential is enormous

    Dead money for at least 18 months as new COO promises a slow, but steady turnaround. Their revenue drop was pretty scary.

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    • Not really..assume the stock will recover in sync with the turnaround so a 20% gain is still only 18.9..point being the potential is great to make a great has to go up 120$ per share to garner that 20%...which do you think is more likely that Apple goes up to about 840 which is a 40% gain or Avon going to 22.05 which is 40%...the decision is yours

    • Not really scary because the drop was all due to currency. Excluding currency it grew 1% in the quarter

      • 1 Reply to courtqueen02
      • Thanks for making that point. The bears seem to contine to dominate discussion about this stock. The WSJ posted another FCPA headline this morning. A long here is only paying about 1x revenues for their Latin American business, which as they said on the CC, has 11.2% operating margins. Mexico grew 10%. People spend a lot of time worrying about a Venezualan devaluation, but the reality is that country will have tremendous oil wealth and should be OK long term. Some of that wealth ought to make its way to the AVP consumer. If McCoy can take $400 million of expenses out of the company, and nothing else deteriorates, then company wide margins ought to improve 2 or 3 hundred basis points, I would think, and then it's hard to see AVP selling for just .6 revenues. Meanwhile AVP is running neck and neck with REV for cheapest US cosmetic stock - both are at about .6 revs...

        Sentiment: Hold

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