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Bebe Stores, Inc. Message Board

  • justjess101 justjess101 Aug 26, 2011 8:39 AM Flag

    bottom line...2012 boring EPS

    ...i dont see any reason to be a buyer here unless you wanna trade it out in the $7 range.

    no growth. no earnings boost. no plan.

    NO HOPE.

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    • ...and no reason to be a buyer. why tie up the money?

    • The only possible catalysts that I can see are as follows:

      Short Term (next 12 months)

      1. Another special dividend (range $.50 - $1) declared in late November and payable in December. They will still have plenty of cash left on hand. At $6 per share, the cash and ARS securities are equal to about 50% of the share price.

      2. Outperforming conservative guidance issued for the 4th quarter. This stock has been a big unerperformer compared to many other retailers over the past several years due to very poor sales and decreasing same store sales. Same store sales have finally stabilized and show early signs of improving. The merchadise also seems to be much better.

      3. No further losses from the underperforming PH8 division, which has finally been closed. This was a big distraction for management and has now been eliminated.

      Longer Term (after 12+ months)

      1. The new president has been on the job for less than 1 year and is still in the process of revamping the merchandise. If they can ever fix the "core" Bebe brand, which has been underperforming for the last several years, this could drive sales and margins back up. They seem to be on the right track and making progress, but still have a way to go. Driving sales up is the primary catalyst long term, but this will be a slow process. Improving sales will depend heavily on the economy improving economy.

      2. Growth in international business -- adding up to 60 new licensee locations in next 12 months to existing 75 licensee locations. This requires little capital and has very high returns. This is still a very small part of the business.

      3. Manny, the founder of Bebe, is 72 and still actively involved in the business. He still holds 53# of the stock after his divorce from his wife Neda. If Manny is sucessful in getting the company back on the right track and going in the right direction, will he finally sell the company?

      4. If the economy does start to show signs of improvement, a lot of cash will eventually pour back into the retail sector and give the stock a lift.

      Just my thoughts....

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