Joe Raedle
Validea's pick of the week provides a detailed report on a company that scores well in the stock-screening service's model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor provides marketing and data services to Validea.ca and receives compensation. Try it.
Stage Stores Inc. operates approximately 850 stores in 40 states, primarily in small and mid-sized towns and communities under the Bealls, Goody's Palais Royal, Peebles, and Stage names. Stage offers moderately priced, nationally recognized brand name apparel, accessories, cosmetics and footwear for the entire family. It has a market cap of $330-million (U.S.).
Stage Stores trades for just 10.5 times EPS. It offers a 5.8-per-cent dividend, part of why it gets strong interest from Peter Lynch model. The Lynch model considers it a "slow-grower", the type of firm attractive primarily for its dividends. The Lynch model likes its 0.79 yield-adjusted P/E-to-growth ratio (PE/(EPS growth+dividend yield).
The Martin Zweig model likes that the debt/equity ratio of 19.5 per cent is well below industry average.
It has a stellar 0.2 price/sales ratio, a big reason why it gets some interest from the Kenneth Fisher-based model.
The company has a 2.4 current ratio, a sign of good liquidity, according to the Benjamin Graham-based approach. It has $325-million net current assets vs. $90-million long term debt, which the Graham-based model likes.
John Reese is long SSI.
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