The Men's Wearhouse, Inc. (NYSE:MW)

Sqwii (< 20) Submitted: 6/2/2008 2:56:00 PM : Start Price: $18.94 MW Score: +93.42

PRICE/SALES RATIO: [PASS]

The prospective company should have a low Price/Sales ratio. Non-cyclical (non-Smokestack) companies with Price/Sales ratios below 0.75 are tremendous values and should be sought. MW's P/S of 0.51 based on trailing 12 month sales, is below 0.75 which is considered quite attractive. It passes this methodology's P/S ratio test with flying colors.

TOTAL DEBT/EQUITY RATIO: [PASS]

Less debt equals less risk according to this methodology. MW's Debt/Equity of 13.03% is acceptable, thus passing the test.

PRICE/RESEARCH RATIO: [PASS]

This methodology considers companies in the Technology and Medical sectors to be attractive if they have low Price/Research ratios. MW is neither a Technology nor Medical company. Therefore the Price/Research ratio is not available and, hence, not much emphasis should be placed on this particular variable.

PRELIMINARY GRADE: Some Interest in MW At this Point

Is MW a "Super Stock"? YES

PRICE/SALES RATIO: [PASS]

The prospective company should have a low Price/Sales ratio. Non-cyclical(non-Smokestack) companies with Price/Sales ratios below .75 are tremendous values and should be sought.MW's P/S ratio of 0.51 is below .75 which is considered extremely attractive. It passes this methodology's P/S ratio test with flying colors.

LONG-TERM EPS GROWTH RATE: [PASS]

This methodology looks for companies that have an inflation adjusted EPS growth rate greater than 15%. MW's inflation adjusted EPS growth rate of 29.01% passes the test.

FREE CASH PER SHARE: [PASS]

This methodology looks for companies that have a positive free cash per share. Companies should have enough free cash available to sustain three years of losses. This is based on the premise that companies without cash will soon be out of business. MW's free cash per share of 1.23 passes this criterion.

THREE YEAR AVERAGE NET PROFIT MARGIN: [PASS]

This methodology looks for companies that have an average net profit margin of 5% or greater over a three year period. MW, whose three year net profit margin averages 6.96%, passes this evaluation.

SECTOR: [PASS]

MW is neither a technology nor financial Company, and therefore this methodology is applicable.

SALES: [PASS]

The investor must select companies of "adequate size". This includes companies with annual sales greater than $340 million. MW's sales of $2,107.5 million, based on trailing 12 month sales, pass this test.

CURRENT RATIO: [PASS]

The current ratio must be greater than or equal to 2. Companies that meet this criterion are typically financially secure and defensive. MW's current ratio of 2.61 passes the test.

LONG-TERM DEBT IN RELATION TO NET CURRENT ASSETS: [PASS]

For industrial companies, long-term debt must not exceed net current assets (current assets minus current liabilities). Companies that meet this criterion display one of the attributes of a financially secure organization. The long-term debt for MW is $106.9 million, while the net current assets are $406.7 million. MW passes this test.

LONG-TERM EPS GROWTH: [PASS]

Companies must increase their EPS by at least 30% over a ten-year period and EPS must not have been negative for any year within the last 5 years. Companies with this type of growth tend to be financially secure and have proven themselves over time. MW's EPS growth over that period of 218.3% passes the EPS growth test.

P/E RATIO: [PASS]

The Price/Earnings (P/E) ratio, based on the greater of the current PE or the PE using average earnings over the last 3 fiscal years, must be "moderate", which this methodology states is not greater than 15. Stocks with moderate P/Es are more defensive by nature. MW's P/E of 9.60 (using the current PE) passes this test.

PRICE/BOOK RATIO: [PASS]

The Price/Book ratio must also be reasonable. That is, the Price/Book multiplied by P/E cannot be greater than 22. MW's Price/Book ratio is 1.30, while the P/E is 9.60. MW passes the Price/Book test.