Corporate Webpages Stage Stores Inc.
The price is right on acqusition of distressed store chains, but would you
not inherit the same distress? Management may think it can turn the situations
around, even leaving the original stores identities, through changed policies, service,
and optimization of inventory management.
Stage Stores Inc. (SSI) was founded in 1988 with a leveraged
buyout of several small specialty clothing stores, concentrated
in small towns in the midwest. The company has always focused
on smaller towns to provide a larger assortment of
manufacturers' items than typically found there.
It started to go public in 1992 but pulled back when market
conditions seemed unfavorable. It finally did go public in
1996. The company competed against much larger chains such as
Sears, Penny's and Target. However, these larger chains began
to abandon smaller towns. Due to a slowdown in store sales and
struggling under a large debt load from possible over-expansion,
the company went bankrupt in 1999, was delisted, and emerged
from bankruptcy in 2001, owned mostly by its creditors. After
that it continued to grow and listed on the NYSE in 2006. It
faced shareholder lawsuits charging company manipulation of its
stock, which even involved Mitt Romney and Bain Capital which
were heavily-invested in Stage shares. The chain was forced to
liquidate much of its inventory at bargain prices and close many
stores. It also had to liquidate many real estate leases.
During the time of bankruptcy, Stage Stores faced charges of
financial manipulation which damaged its credit rating and made
it hard to get further credit. CEO Carl Tooker figured heavily
in this.
Analysts gave little hope for the survival of the chain.
Something which attracted our attention was the use of credit
Stage was able to obtain to buy other troubled clothing outlet
chains. If another chain was struggling for survival, why would
one want to buy it to add to woes already incurred in the same
line of business? Further, these troubled chains kept their
separate identity in most cases. The purchase of the Goody's
chain in a distress auction is a particular recent example.
K-Mart's acquisition of Sears around 2009, decimating that
venerable old catalog retail chain, led to futher doubt about
department store retailing potential. Declining same store sales were
accompanied by more and more borrowing by Stage Stores
and acquisition of more and more stores from other troubled chains.
Havings said all that, we concede that Stage Stores has one of
the strongest possible Zenith Indices. That suggests very good
fundamental strength, despite claims otherwise in the "Market
Grader" analysis. We are beginning to question "Market Grader"
analyses in general, but since so many people follow them regard
them as a factor anyway. The company after coming out of bankruptcy
reformed, leaner and meaner has reduced its debt practically
down to nothing. The stock is now trading close to its book
value which consists of hard real estate assets. Although they
have been doing a little bit of unloading, the presence of
Dimensional Fund Advisors (DFA) as the second largest holder is
enough to scare us off from any serious short sale consideration.
(DFA is one of the institutional fund advisors we respect the most.)
Also, we note the retail industry group as a whole is recently
strengthening indicating we are coming out of recession which is
something the stock market has been telling us for months. That
could only be good for Stage Stores sales. Weak earnings growth
has been their major detracting factor. One is betting on their
ability to convert non-performing stores to better ones based
upon customer service, brand name selection, and locations.
This is supported by their own internal data and latest reports.
Also note this is a channeling (rolling) stock in the lower edge of
its channel suggesting now is a good time to buy.
11-13-2011: Stage Stores Inc.: Can You Turn Distressed Store Chains Into a Good Ones?
(WAIT FOR PAGE TO LOAD COMPLETELY BEFORE LINKS WORK.)
Company Profile
Company History
News
Comparison with Peers
Bond Issue
Zenith Index
Financial Statements
Financial Ratios
Market Grader
Intrinsic Value (Disc. CashFlow)
Intrinsic Value (Proj. Earnings)
Scout Stock Rating
Projected Earnings
Research Reports
Analysts' Opinions
Insider Activity
Institutional Activity
Sentiment
Short Interest
Stock Report
Management's Discussion
Moving Average Chart
Right Time Study
Channel Potential
Intraday Chart
Stock Fetcher
Point & Figure Chart
Wall Street Analyzer
Marketspace Chart
Time Series Forecast
Neural Network Prediction
Stock Options
Ultimate Trading Systems
Recommendation
Corporate Wepages
Company Profile |
Company History |
News |
Comparison |
Similar Companies Performance:
Bond Issue |
Zenith Index |
Under current market conditions, a Zenith Index Score of 1.20 or above is required for a positive rating on this factor. 1.21 -1.30 is considered acceptable, 1.30-1.40 is consider strong and > 1.40 is considered exceptionally strong. Accounting statements in this section often contain mistakes, especially in earlier years' totals, but data is deemed sufficient for us to give a rating. More accurate financial statements follow in the next section.
Stage Stores Inc. (SSI ) Sector: Services
10201 Main Street Industry: Apparel Stores
Houston, TX 77025 Exchange: NYSE
Stage Stores, Inc. operates as a specialty department store retailer that
offers branded and private label apparel, accessories, cosmetics, and
footwear for women, men, and children in the United States. The company
also offers sportswear, dresses, intimates, home and gift products,
outerwear, swimwear, and other products. It primarily focuses on consumers
in small and mid-sized markets. As of May 27, 2011, the company operated
799 stores in 39 states under the names of Bealls, Goody-Ęs, Palais Royal,
Peebles, and Stage. Stage Stores, Inc. is headquartered in Houston, Texas.
Last Trade: 14.41 52-Week Range: 19.97 - 12.18
Trade Date: 11-12 Avg. Volume: 413,794 Shares
Index Membership: Employees: 13,500
Corporate Governance:
Audit (Low Concern), Board (Low Concern), Compensation
(Medium Concern), Shareholder Rights (Low Concern).
EPS: 0.96 Dividend Amount: $ 0.36 Yield: 2.50%
Ex-Dividend Date: Sep 1, 201 Mkt Cap: $ 448,310K
Payout Ratio: 32.00%
Last Split Factor (new for old): 3:2 Split Date: Feb 1, 200
Key Statistics:
Enterprise Value: $ 478,810K Revenue (ttm) : $ 1,480,000K
Gross Profit: $ 416,820K
Earnings before Income Tax, Depreciation and Amortization: $ 118,340K
Enterprise Value/Revenue (ttm): 0.32 Revenue per Share: $ 41.10
Enterprise Value/EBITDA (ttm): 4.05 Qtrly Rev Growth (y to y): 2.30%
P/E Ratio (fwd projected): 11.53 P/E Ratio (current): 15.09
P/E Growth Ratio (5 yr expected): 1.00 Operating Margin: 3.92%
Price/Sales Ratio: 0.29 Profit Margin: 2.34%
Price/Book Value: 1.04 Book Value: $ 13.15/sh.
Return on Assets: 4.63% Net Income Avl to Common: $ 34,670K
Return on Equity: 7.55% Diluted Earnings/Share: $ 0.96
Qrtly Earnings Growth (yoy): -3.00%
Balance Sheet Items : Cash Flow Items (ttm):
(most recent qrtr) (trailing 12 mo.)
Total Cash: $ 29,350K Operating Cash Flow:$ 74,470K
Total Debt: $ 59,850K Lvgd Free Cash Flow:$ 31,010K
Total Debt/Equity: 13.89
Total Cash/Share: $ 0.94
Current Ratio: 2.21
Share Statistics: Stock Price History:
Shares Outstanding: 31,110K Stk 52-Week Change: 5.49%
Float: 30,240K S&P 500 52-Wk Chng: 5.39%
Sh. Short % of Float: 14.50% 50-Day Moving Avg: 14.72
Short Ratio: 13.20 200-Day Moving Avg: 16.02
% Held by Institutions: 102.00% Beta: 1.58
% Held by Insiders: 1.06%
Analysts' Estimates: Cur. Qtr Next Qtr Cur. Year Next Year
___________________________ Oct 11 Jan 12 Jan 12 Jan 13
Average Earnings Estimate -0.31 1.12 1.05 1.25
Average Revenue Estimate 34M 469M 1,500M 1,570M
Factors Comparing This Company to Its Industry Leader (1.0 = Average):
Long Term EPS Growth Rate (5 yr): 2.840 EPS Growth (Qrtly YoY): 2.731
PEG Ratio (ttm, 5 yr expected): 2.088 P/E Ratio (ttm): 4.704
Revenue Growth (Qrtly YoY): 1.614
Annual Income Statements: All numbers in thousands)
Period Ending Jan29,2011 Jan31,2010 Jan31,2009
Total Revenue 1,470,590 1,431,927 1,515,820
Cost of Revenue 1,053,766 1,040,120 1,106,236
Gross Profit 416,824 391,807 409,584
Operating Expenses:
Research & Development 0 0 0
Selling, General & Administrative 350,865 338,551 351,246
Non-Recurring Expenses 3,192 3,041 101,853
Other Operating Expenses 0 0 0
Total Operating Expenses 0 0 0
Operating Income or Loss 62,767 50,215 -43,515
Income from Continuing Operations:
Total Other Income/Expenses Net 0 0 23
Earnings Before Interest & Taxes 58,892 45,827 -48,731
Interest Expense 0 0 5,239
Income Before Taxes 58,892 45,827 -48,731
Income Tax Expense 21,252 17,106 16,804
Minority Interest 0 0 0
Net Income from Continuing Op.s 37,640 28,721 -65,535
Non-recurring Events:
Discontinued Operations 0 0 0
Extraordinary Items 0 0 0
Effect of Accounting Changes 0 0 0
Other Items 0 0 0
Net Income 37,640 28,721 -65,535
Preferred Stock & Other Adjustmnts 0 0 0
Net Income Avail To Common Shares 37,640 28,721 -65,535
Quarterly Income Statements: All numbers in thousands)
Period Ending Jul30,2011 Apr30,2011 Jan29,2011 May1, 2010
Total Revenue 352,832 346,483 453,679 340,042
Cost of Revenue 248,975 261,263 307,490 250,147
Gross Profit 103,857 85,220 146,189 89,895
Operating Expenses:
Research & Development 0 0 0 0
Selling, General & Adminis. 86,075 83,602 93,834 83,849
Non-Recurring Expenses 906 2,734 168 1,456
Other Operating Expenses 0 0 0 0
Total Operating Expenses 0 0 0 0
Operating Income or Loss 16,876 -1,116 52,187 4,590
Income from Continuing Operations:
Total Other Income/Expenses Net 0 0 0 0
Earnings Before Int. & Taxes 17,782 -2,022 51,291 3,545
Interest Expense 1,791 0 0 0
Income Before Taxes 15,991 -2,022 51,291 3,545
Income Tax Expense 5,978 -1,561 19,311 1,347
Minority Interest 0 0 0 0
Net Income from Continuing Op.s 10,013 -461 31,980 2,198
Non-recurring Events:
Discontinued Operations 0 0 0 0
Extraordinary Items 0 0 0 0
Effect of Accounting Changes 0 0 0 0
Other Items 0 0 0 0
Net Income 10,013 -461 31,980 2,198
Preferred Stock & Other Adj.s 0 0 0 0
Net Income Avail To Common Shs 10,013 -461 31,980 2,198
Annual Balance Sheets: All Numbers in Thousands
Period Ending Jan29,2011 Jan31,2010 Jan31,2009
Current Assets:
Cash & Cash Equivalents 89,349 93,714 26,278
Short Term Investments 0 0 0
Net Receivables 0 2,535 385
Inventory 325,501 306,360 314,517
Other Current Assets 30,423 24,560 30,439
Total Current Assets 445,273 427,169 371,619
Long-Term Investments 0 0 0
Property, Plant & Equipt 317,954 342,001 367,135
Goodwill 0 0 0
Intangible Assets 14,910 14,910 14,910
Accumulated Amortization 0 0 0
Other Assets 17,947 16,351 14,379
Deferred Long Term Asset Charges 0 0 0
Total Assets 796,084 800,431 768,043
Current Liabilities:
Accounts Payable 169,683 170,290 158,487
Short/Current Long Term Debt 13,490 12,726 11,161
Other Current Liabilities 0 0 35,171
Total Current Liabilities 183,173 183,016 169,648
Long Term Debt 25,002 38,492 45,851
Other Liabilities 84,001 90,978 94,333
Deferred LT Liability Charges 14,399 11,899 8,208
Minority Interest 0 0 0
Negative Goodwill 0 0 0
Total Liabilities 306,575 324,385 318,040
Stockholder Equity:
Misc. Stocks Options Warrants 0 0 0
Redeemable Perferred Stock 0 0 0
Preferred Stock 0 0 0
Common Stock 569 561 558
Retained Earnings 295,851 267,661 246,569
Treasury Stock -320,055 -288,079 -286,751
Capital Surplus 516,079 501,800 494,765
Other Stockholder Equity -2,935 -5,897 -5,138
Total Stockholder Equity 489,509 476,046 450,003
Net Tangible Assets 474,599 461,136 435,093
Quarterly Balance Sheets: All Numbers in Thousands
Period Ending Jul30,2011 Apr30,2011 Jan29,2011 May1, 2010
Current Assets:
Cash & Cash Equivalents 29,352 66,296 89,349 80,207
Short Term Investments 0 0 0 0
Net Receivables 0 0 0 0
Inventory 357,625 382,431 325,501 349,195
Other Current Assets 28,245 22,655 30,423 26,306
Total Current Assets 415,222 471,382 445,273 455,708
Long-Term Investments 0 0 0 0
Property, Plant & Equipt 310,242 314,952 317,954 335,382
Goodwill 0 0 0 0
Intangible Assets 14,910 14,910 14,910 14,910
Accumulated Amortization 0 0 0 0
Other Assets 20,637 19,738 17,947 17,132
Deferred LT Asset Charges 0 0 0 0
Total Assets 761,011 820,982 796,084 823,132
Current Liabilities:
Accounts Payable 173,801 210,113 169,683 188,514
Current Portion LT Debt 13,889 13,688 13,490 12,932
Other Current Liabilities 0 0 0 0
Total Current Liabilities 187,690 223,801 183,173 201,446
Long Term Debt 45,956 21,505 25,002 34,844
Other Liabilities 96,348 98,940 84,001 103,248
Deferred LT Liab. Charges 0 0 14,399 0
Minority Interest 0 0 0 0
Negative Goodwill 0 0 0 0
Total Liabilities 329,994 344,246 306,575 339,538
Stockholder Equity:
Misc. Options, WarrantS 0 0 0 0
Redeemable Perferred Stock 0 0 0 0
Preferred Stock 0 0 0 0
Common Stock 577 575 569 568
Retained Earnings 299,995 292,636 295,851 267,946
Treasury Stock -394,613 -337,203 -320,055 -288,202
Capital Surplus 527,944 523,639 516,079 509,113
Other Stockholder Equity -2,886 -2,911 -2,935 -5,831
Total Stockholder Equity 431,017 476,736 489,509 483,594
Net Tangible Assets 416,107 461,826 474,599 468,684
Annual Cash Flow: All Numbers in Thousands
Period Ending Jan29,2011 Jan31,2010 Jan31,2009
Net Income 37,640 -461 -65,535
Operating Activites:
Depreciation 63,142 64,269 59,248
Adjustments to Net Income 14,962 10,630 131,643
Changes in Accounts Recv'bls 0 0 0
Changes in Liabilities -10,512 7,221 -15,997
Changes in Inventories -19,141 8,157 28,105
Changes in Other Op'ing Actv's 0 1,938 25,319
Total Cash Flow fr Operations 77,875 120,936 162,783
Investing Activities:
Capital Expenditures -36,990 -42,707 -99,841
Investments 0 0 0
Other Cash Flows fr Investing 0 2,954 3
Total Cash Flows fr Investing -36,459 -39,753 -99,838
Financing Acitivies:
Dividends Paid -9,450 -7,629 -7,699
Sale or Purchase of Stock -25,777 -420 -4,373
Net Borrowings -12,726 -5,794 -43,582
Other Cash Flows fr Financing 0 0 2,207
Total Cash Flows fr Financing -45,781 -13,747 -53,695
Effect of Exchange Rate Change 0 0 0
Change in Cash & Cash Equiv.s -4,365 67,436 9,250
Quarterly Cash Flow: All Numbers in Thousands
Period Ending Jul30,2011 Apr30,2011 Jan29,2011 May1, 2010
Net Income 10,013 -461 31,980 2,198
Operating Activites:
Depreciation 15,548 15,539 16,645 14,499
Adjustments to Net Income 2,520 3,533 5,587 3,056
Changes in Accounts Recv'bls 0 0 0 0
Changes in Liabilities -39,695 38,293 -83,511 16,601
Changes in Inventories 24,806 -56,930 94,577 -42,835
Changes in Other Oper'g Acts 0 5,856 -3,721 214
Total Cash Flow f Operations 7,756 5,830 61,557 -6,267
Investing Activities:
Capital Expenditures -10,245 -11,858 -8,941 -8,496
Investments 0 0 0 0
Other Cash Flows fr Investing 0 93 531 0
Total Cash Flows fr Investing -10,245 -11,765 -8,410 -8,496
Financing Acitivies:
Dividends Paid -2,654 -2,754 -2,765 -1,913
Sale or Purchase of Stock -55,870 -11,732 1,597 4,706
Net Borrowings 24,652 -3,299 -3,252 -3,442
Other Cash Flows fr Financing 0 0 0 0
Total Cash Flows fr Financing -34,455 -17,118 -9,274 1,256
Effect of Exchange Rate Chg 0 0 0 0
Change in Cash & Cash Equiv. -36,944 -23,053 43,873 -13,507
SSI Stage Stores Inc. [Indices near +3.0 or near zero,
or < zero bear special attention.]
P/E Ratio Tests:
Current P/E Ratio < 28? 1.8555 P/E Ratio > 5? 1.0000
P/E Ratio Vs Growth Rate: 1.0000 Forward P/E Ratio < 28? 2.4284
Sales Tests:
Price/Sales Ratio < 2.3? 3.0000 Inventory/Sales < 5%? 0.2259
Sales < $1 billion? 0.6800 Operating Margin < 7.5%? 1.9133
Balance Sheet Tests:
Debt/Equity < 0.40? 0.0288 Long-Term Debt Service: 3.0000
LTD Being Reduced? 2.4000 Short-Term Debt Service: 3.0000
Current Ratio > 2? 1.1050 Working Capital >= 1.5? 0.9040
Leverage Ratio < 20%? 2.6339 Debt / Assets < 1? 3.0000
Quick Ratio > 1? 0.1564 Inventory Turnover > 1? 3.0000
Shares Out Decreasing? 2.4000 Market Cap.> 1.5 Billion? 3.0000
Profit Margin > 7.5%? 0.3120
Income Tests:
Dividend Yield > 2.0%? 2.4000 EPS Annual Growth > 10%? 0.6100
Enterprise Value/Revenue: 0.2133 EPS 5-yr Growth > 20%? 3.0000
Enterprise Value/EBITDA: 0.5786 EPS Growth Consistent? 2.4000
EPS Qrtly Growth > 10%? -0.3000 Collection < 45 days? 1.0000
Rev. Qtrly Growth > 15%? 0.3450 Gross Pft/Cur. LTD < 1? 3.0000
EPS Annual Growth > 10%? 0.6100 Borrowing Int. Rate< 6%? 2.3772
Stock Performance Tests:
Volatility > 25%? 1.9384 % Held by Insiders < 5%? 3.0000
Beta > 1.25? 1.2640 % Held by Institut. < 50? 0.4902
50 Da MA > 200 Da MA? -0.2706 % Held by Institut. > 30? 3.0000
52-Wk Change vs. S&P 500: 0.3594 Short Ratio > 5? 2.6400
Price/Book Value < 3? 2.9600 Short % of Float > 20? 0.7250
Return on Assets > 17%? 0.2724 Average Volume > 100,000? 3.0000
Cash Flow Tests:
Oper. C.F. > Lever'd C.F: 2.4015 Positive Free Cash Flow? 1.0000
Positive Oper. Cash Flow? 1.0000 Price to C.F./sh. Ratio: 1.0326
Cash Flow / Assets >.10? 0.4075
SSI Stage Stores Inc. Overall Zenith Index: 1.6508
Financial Statements |
Income Statement:
Balance Sheet:
Cash Flow Statement:
Financial Ratios |
. . . . . . . . . . . . 1 = Highest , 10 = Lowest
Market Grader |
Intrinsic Value (DCF) |
Intrinsic Value by Discounted Cash Flow Method:
Intrinsic Value (PEG) |
Intrinsic Value by Projected Earnings Growth Method:
Stock Scout |
We find "Scout" to be a bit biased toward the high end, so anything under a 6 is considered a negative, 6 and above, positive.
Projected Earnings |
Research Reports |
Analysts' Opinions |
Insider Activity |
Institutional Activity |
Institutional Orders to Buy or Sell:
Sentiment |
Zenith uses the "sentiment" score above or below 50 to award a positive or negative point in the Decision Matrix.
Short Interest Ratio |
As the short interest rises as a percentage of average daily share volume (Days to Cover), this is considered a measure of negative sentiment. Similarly, a decrease in that percentage is considered positive sentiment.
Stock Report |
Management's Discussion of Results of Operations Excerpts |
Moving Average Chart |
Right Time Study |
Channeling Potential |
The summary below includes a value for `Degree,' which refers on a
scale of 1 to 10 the range of a channel in the period under consi-
deration compared to the total range of price movement. It also looks
for the last closing price to be within the channel, otherwise zeroed.
The `Index' is the `Degree' weighted for volatility. Generally, the
the higher the index, the more suitable is the stock for trading as
a `rolling stock' between channel high and low points.
Results for Stage Stores:
Symbol? SSI
Total Months Available: 68
Months in Cycle? 4
Months Covered by Periods: 12
Period 1 Period 2 Period 3
H1 L1 H2 L2 H3 L3
19.95 13.39 19.97 14.07 19.33 12.18
RANGE = 19.97 TO 12.18 Close = 13.69
CHANNEL = 19.33 TO 14.07 Degree = 7
Volatility = 38.42% Index = 26
Intraday Chart |
2 Days:
Stock Fetcher |
Point & Figure Chart |
Wall Street Analyzer |
Marketspace Chart |
Time Series Forecast |
Neural Network Prediction |
"Neurostock" can only track long trades. Therefore its performance, as tracked by itself on stocks which are consistently falling, may not appear as good as it could if each "sell" signal were a "short sale."
Ultimate Trading Systems |
The "ultimate systems" are inconclusive, giving no clear confirmed signals.
The corresponding trades for the above chart are shown in tabular form below.
Recommendation |
| Factors | Weighted Points |
|---|---|
| News | + 1 |
| Comparison | + 1 |
| Industry | + 1 |
| Bond Issue | 0 |
| Zenith Index | + 1 |
| Non-GAAP vs. GAAP Earnings < 1% | - 1 |
| Cash Flow | - 1 |
| Ratios | + 1 |
| Market Grader | - 1 |
| Intrinsic Value DCF | + 1 |
| Intrinsic Value DDM | + 1 |
| Stock Scout | + 1 |
| Projected Earnings | + 1 |
| Research Reports | - 1 |
| Analysts | - 1 |
| Executive Perquisites | + 1 |
| Insider Activity | - 1 |
| Institutional Activity | - 1 |
| Management Reporting | + 1 |
| Short Interest | + 1 |
| Sentiment | - 1 |
| Standard & Poor's | - 1 |
| Moving Average | - 1 |
| Right Time Study | + 1 |
| Stock Fetcher | + 1 |
| Point & Figure | - 1 |
| Wall Street Analyzer | - 1 |
| Marketspace Chart | - 1 |
| Time Series Chart | + 1 |
| Neural Network | + 1 |
| Stock Options | - 1 |
| Ultimate Trading Systems | 0 |
| Total | + 2 |
Place 2,080 shares of Stage Stores Inc. (SSI) on the Active List.
