Fossil Group, Inc. (NASDAQ:FOSL)

CAPS Rating: 4 out of 5

The Company is a design, development, marketing and distribution company that focus in consumer fashion accessories.


Player Avatar TMF1000 (99.71) Submitted: 8/5/2011 3:00:04 PM : Outperform Start Price: $112.36 FOSL Score: -74.70

My caps price is 112.36 which gives them a PE ratio of 27.41. This isn't so high considering their TTM sales grew 41.4% to $2.17 billion. TTM earnings were $4.10 up 75% from last year. In the past, they have been hurt by recessions and I think that is why the price has dropped from their high of the year of $134.98. I think they will march right back up in time.

The real driver of growth in my opinion is their direct to consumer segment. They have 362 stores.
Jennifer Pritchard retail division president said, “Our objective is to be as big as we can be.” Over 50% of new fossil stores will be in Europe as will half of their accessory stores. Growth has been excellent there and there is less competition.

They reported in their last quarter that their Direct to Consumer sales rose 28%, driven by a comp store sales increase of 21.3%. If they can continue that pace, the holiday season should be a very good one.

They make excellent cash flow - TTm cash flow was $156.68 or $2.42 per share
They have about $355 million in cash and $9 million in debt

They report on August 9, 2011. I think it will be a good report

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