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dELİA*s AŞ Message Board

  • robchadwick robchadwick Jun 25, 2010 5:26 AM Flag

    DLIA turnaround

    First, take the ads for other companies off of your website. This is an obvious acknowledgement that your brand is worth nothing as you're willing to run other companies ads for video games on your front page. Absurd.

    Second, the brand is dead, the clothing line is cheap and style is no better than wal-mart - DLIA's has a chunk of cash, use it - acquire a hip private that knows how to build customer loyalty & run a real web presence -- top on my list would be small privately held

    Third, target 16-30, not 12-16. Your stuff is cheap and undifferentiated.. The younger market buying cheap stuff is going to do so at Wal-Mart, Target, etc.. the yuppie kids are buying A&F, Gap, etc. Need a different style with higher price points appealing to a broader market with more control over their own wallets.


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    • I'm running out of reasons to hold this stock. I suppose it's cheap based on cash per share, but it's hard for me to conceive of how any kind of turnaround is going to occur given what appears to be a bland and non-distinct line of clothing that under the best of conditions would appeal to an extremely narrow segment of the market.

      A lot of the stuff does look like it belongs in a Sears catalog, as someone once said here. Women I show their catalogs to sometimes say they like the look of the dresses and other clothes, and some say they think the dresses and tops look cheap, but nearly all of them comment that they could buy something comparable for a lot less at Target or some other store.

      I hear that all the time. I can't imagine that Delia's merchandise itself is going to drive any turnaround, so that leaves us with 1) more favorable lease terms and closing underperforming stores (a Delias investment thesis that was first discussed prior to the end of World War II); and/or 2) selling the company.

      Both of these scenarios sound like ideas people come up with when they've run out of plausible turnaround ideas and are just trying to come up with something to justify hanging on. I don't see any reason to think the situation here is going to be different next year, or the year after that. It might be, but there's no reason to think it will.

      As some have pointed out, the turnaround story has been discussed on this board for many years, since 2003 or 2004, like some kind of ancient myth or oral history being passed down to younger generations of bagholders. They reality is that nothing really changes, and the stock just drags along year in and year out, with the CEO leaving for unknown reasons, and no insiders showing any interest in buying the stock for many years.

      I don't see any pressing reasons to leave capital parked here. Seems like a Hail Mary play to me, just sitting around hoping that something will happen.

      • 2 Replies to towlerfamily
      • "I don't see any pressing reasons to leave capital parked here."

        You should read Jeremy Grantham's latest letter. As you may well know, large cap quality stocks have been suffering at low P/Es for sometime. Grantham presents several good reasons why this is and why this situation may persist for sometime.

        Then he states that the forces keeping the stocks of large quality stocks "undervalued", are akin to "holding a ping pong ball underwater". You can force a ping pong ball underwater for a time even for a long-time, but eventually gravity takes its toll and the ping pong ball comes whooshing up.

        In the past, I have owned stocks for long periods of time that had very satisfactory returns where the bulk of my return came in a matter of days.

        My sense, is that eventually this company is going to have to show that it can really turn itself around or the shareholders are going to demand that it be sold. I don't think that the shareholders are going to take the status quo much longer.

      • this is just an opinion from an unknown person from the internet and it should not be construed as a recommendation.

        imo, something DID happen. We have found our voice starting with our july book. The merchandise, together with the presentation and how everything is put together...i'm smiling as i type this. Our fashion forward, feminine, cute, chic, but not trashy edit really shines. Skirt, dresses, lacey, floral, military, crop tops and those boots if i were a girl i would be buying all those. We have hot boots this fall. I have complained about our merchandise quality before but our bts merchandise quality is top notch in some cases better than our peers. I have been to target, sears, and all of our competitors. Maybe i'm just blind but i see uniqueness in our bts offering started in july and continued in august. I must say if our result for july and august is bad, it is not due to merchandise anymore. At least not our bts merchandise. I do worry about our pricing a little bit but it kinda shows our strength than weakness.

        i think you should at least check out our store near you if there is one, see what kind of merchandise and promotions we have vs our competitors, and if you have time try to see what our targeted customers are saying about us online.

        just my 0 cent. take it for wht it's worth.

    • You have it wrong, Delia's needs to focus on the younger customer that was and should be their core customer. Looking at the catalog models you see that older customer and guess what that's why the business is faltering. It was a successful formula until 2001. As for the quality of the merchandise that is somethng that needs to be corrected you can only get so many people through the door. Just my point of view.

      • 1 Reply to lsr8974
      • In 2001 they executed well with the 70's / hippie style stuff. By '05, hippie stuff was on it's way out.. by 2007, 80's influences were big.. DLIA's went from trendy to just blah.

        You can get the 12-19 market while picking up the 18-30..

        Their brand is worthless, as evidenced by their willingness to hawk it selling ad space.

        I'm suggesting they ditch the name, relaunch with a new line and go with either a distinct style, or embrace retro in a big way like has.

        Blowing a few million on this now is still possible. If their game is to just wait for a macro recovery they're going to get crushed and just burn through the rest of their cash.

        I like this stock because of the cash on hand. I'm hopeful that they realize they can't keep doing what they're doing today and will make a change. I keep coming back to the fact that they're selling ad space on their website though. Why the heck would they do this?? Their marketing folks need to go.

    • Forever 21 is a freaking madhouse at the mall near where I live. Drives me nuts to see that place packed so full all you can see is a thousand heads. Why can't Delias tap into some of that action? Boston says Rue 21 is more like Delias true competition, maybe so. All I know is, there's no shortage of young girls out there buying stuff, at least not in Phoenix.