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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.
New Jersey-based The Vitamin Shoppe Inc. is a multi-channel specialty retailer and contract manufacturer of vitamins, minerals, herbs, specialty supplements, sports nutrition and other health and wellness products. The firm sells through retail stores and direct selling (through e-commerce and catalogs). It has an $870-million (U.S.) market cap.
The company trades for 15 times TTM EPS. It has grown EPS at a 25-per-cent clip over the long term (using avg of 3, 4 and 5yr EPS growth rates), part of why it gets strong interest from Peter Lynch model. The Lynch model also likes its 0.6 P/E-to-growth ratio.
The Vitamin Shoppe has debt/equity ratio of just 1.4 per cent. It has a 0.69 price/sales ratio, helping it earn strong interest from the Kenneth Fisher-based model. It has averaged net profit margin of 5.9 per cent over past three years, which the Fisher-based model likes.
The company has averaged a 41.9-per-cent return on retained earnings (those not paid out as dividends) over past decade, which impresses the Warren Buffett-based model.
It also has a solid 2.23 current ratio, a sign of good liquidity, and a return on capital using the Joel Greenblatt-based model's EBIT/tangible capital employed metric of 33 per cent.
John Reese is long VSI.
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