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Kirkland's Inc. Message Board

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  • pvigo123 pvigo123 Aug 20, 2010 11:55 AM Flag

    Their numbers were not bad...

    Don't forget to net out the $3.50 in cash per share that they have. Net of cash, the stock is trading at 8.50. Assuming a conservative $1.50 EPS going forward, the stock in trading at about 5.5x earnings. Stupid. Huge overeaction. Last quarter they gave the exact same guidance in their release, they said because of higher taxes and higher shipping costs, they expected to make slightly more than last year. I don't know what everyone is so shocked about. $1.50 EPS in 2010 is great. They are returning to store growth next year and EPS should grow to $1.65 to $1.85 in 2011, possibly higher if shipping costs come back down.

    Why would a company that is likely to grow next year and generate $1.75 EPS trade at $12? It makes absolutely no sense. They have no debt and no financing risk even if the economy double dips. Yet people will pay 15x EPS for Williams Sonoma or 20x for ANF even with a crappy outlook. Sometimes thing just trade stupid.

12.50+0.14(+1.13%)Aug 29 4:00 PMEDT