I owned this stock many years ago and just started looking at it again today. am wondering if anyone using this board has any credible insight, either pro or con, as to the current price level being a good entry point. i would be looking at a purchase of around 700 shares. from what info i have been able to gather so far, it appears to be a fairly safe bet. anyone out there agree or disagree??
Cataldo said that in 2011, company officials expect "continued top-line challenges," in light of the higher food and energy prices and job insecurity especially affecting CPI's our core customer. "We are, nevertheless, encouraged about our prospects to sustain solid profitability and cash generation over the next year based on already identified cost reductions and operating income improvement expected from the Kiddie Kandids operations." ...
Portrait studio operator CPI Corp. said its fourth-quarter profit fell 31 percent on lower sales.
For the quarter ended Feb. 5, the company reported net income of $14.9 million compared with net income of $21.7 million in the prior-year quarter.
Sales in the recent quarter fell 8 percent to $128.9 million compared with $140.2 million in the fiscal fourth quarter of last year. The fourth quarter was a real downer and the stock reacted accordingly. I don't particularly like their business and they are loaded with debt. But they are maintaining a positive cash flow and certainly the PE is low so let's see tomorrow's report based on what is said below in their 4th q.
The company said fourth-quarter 2010 earnings were significantly affected by declines in same-store sales; an adverse commission adjustment related to larger-than-expected sales declines; and increased employee insurance, pension and amortization expense.
CPI said same-store sales fell 14 percent in the recent quarter.
CPI's president and CEO, Renato Cataldo, said in a statement that the company's fiscal fourth-quarter results reflected "very difficult industry and broader economic conditions" in the period.
For the full fiscal year 2010, CPI reported net income of $11.9 million on sales of $407 million, compared with net income of $13.8 million on sales of $422.4 million in fiscal 2009.
Cataldo said that in 2011, company officials expect "continued top-line challenges," in light of the higher food and energy prices and job insecurity especially affecting CPI's our core customer. "We are, nevertheless, encouraged about our prospects to sustain solid profitability and cash generation over the next year based on already identified cost reductions and operating income improvement expected from the Kiddie Kandids operations."
Last spring, CPI paid $2.6 million for the assets of bankrupt Naperville, Ill.-based Kiddie Kandids and began reopening its portrait studios, most of which were in Babies R Us stores. The company relaunched the brand in 171 locations last year.
In January, CPI bought San Francisco-based Bella Pictures, a photojournalistic-style wedding photo network. In the company's quarterly report Tuesday, Cataldo called Bella "a potential game-changer as we seek to transform our relationships with customers."
St. Louis-based CPI Corp. (NYSE: CPY) operates portrait photography services in about 3,100 locations in the United States, Puerto Rico, Canada and Mexico, mostly in Sears and Wal-Mart stores, and offers on location wedding photography and videography services through its Bella Pictures subsidiary. Read Full Article
Read more: CPI Q4 profit, sales fall | St. Louis Business Journal
If the current earnings projection of 2.33 for this year and 3.70 for next year turn out to be valid, then stock appears to be greatly oversold now. Dividend was increased about a year ago. High 7% dividend yield!