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Avon Products Inc. Message Board

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  • courtqueen02 courtqueen02 Nov 2, 2012 11:22 AM Flag

    Potential is enormous

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

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    • 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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