Stockchase Opinions

Colin Stewart Le Chateau Inc. (A) CTU-X BUY Feb 27, 2008

Moderately priced women's apparel. A really successful franchise in Canada. Trades at quite a discounted valuation at about 10X earnings. Has a healthy balance sheet with over $1 a share in net cash. Looking at this one.
$12.550

Stock price when the opinion was issued

clothing stores
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HOLD
This was one of the retailers that was talked about becoming an income trust. It had a run-up because of that. Well managed. Prefers US retailers that there's nothing wrong with this company.
HOLD
Bought it for the special dividend that they had offered. Still ripe for sale. The only danger is that they get the fashion style wrong.
TOP PICK
Girls’ clothing. One of the best executors out there. Has been beaten up in the last couple of weeks because of a weaker back-to-school report. Has been oversold. 3.65% yield.
TOP PICK
A very cheap name right now. Investors are frightened of the retail space, primarily because of the weak US$ and cross-border shopping cutting into the margins. Same-store sales growth has been double digit. No debt.
COMMENT
Pretty good underlying business. Retail has been very much out of favour in this market. Trades at a very low valuation multiple and generates a significant amount of cash flow. Smaller capitalization stock and a very illiquid trader.
TOP PICK
Specialty retail clothing. Earnings were up 34% last year. Very flexible and can quickly handle changes in the marketplace. Yield of 4.6%. Pretty safe stock with upside.
HOLD
Great company. Challenge is that they are approaching saturation. Doesn’t know where the growth comes from. Move on when you get a chance.
DON'T BUY
Facing increased competition as US shops come up into the malls in Canada. Dividend coverage is a little bit on the weak side.
DON'T BUY
This has been a very difficult stock. Recently reported a very bad quarter. He would stay away from this one. Inventory has gone up a lot and their margins have fallen. Cut the dividend totally. Thinks they are in a bit of trouble.