The Buckle, Inc. (BKE)

Somebody forgot to tell The Buckle there is a recession: Simply the best apparel retailer around - consistent top & bottom line growth, conservative store growth, and an unbelievable run of 22 consecutive months of double digit same-store sales growth, with 33 straight month of same-store sales gains overall.

The store hooks you up with your perfect pair of jeans. In fact, denim represents 45% of sales. While the stock is benchmarked to other fashion apparel with fickle consumers, your perfect pair of jeans doesn't go out of style. Unlike other downtrodden retail stocks, it has strong cash flow and little debt. Buy! Buy! Buy!

Chuckle with Buckle!!!!

Buckle is a retailer of casual apparel, footwear and accessories for fashion conscious young men and women. The company operates 354 retail stores across 38 states throughout central, northwest, southeast and southwestern U.S under the names “Buckle” and “The Buckle”.

In the past five years, premium denim segment from the jeans market has become one of the hottest segments of the apparel industry. Consumers aged 13 to 24 have bought the largest share of premium denim jeans. This augurs well for the company, which targets the same age group and derives about 48% of its revenues from denim. The share of denim to the total revenues has grown substantially since the past five years. Long known as a denim destination, Buckle plans to open a store in Florida and Tennessee. The recent performance of the company has been fine driven by new stores and about 6% increase in denim price points. Gross margin improved marginally due to an increase in private label that constitute about 33% of sales mix.

On the management front, the company’s buying team is quite strong with top four members having a combined experience of 90 years in the industry. Moreover, the company has been consistent in store openings since the past ten years. Also, November sales have also been impressive with over 8% rise in sales. Furthermore, this zero debt company has achieved consistent revenue and earnings growth, allowing investors to take a bullish view on the stock.

So what's not to like?

Sales 26.2
Dividend 22.2
Valuation TTMPrice / Earnings 14.3x
Price / Sales 1.9x
Price / Book 4.5x
Price / Cash Flow NA --
Management Effectiveness TTMReturn on Asset 23.72%
Return on Equity 31.18%
Return on Inve. Cap. 28.12%
Operating Ratios TTMAsset Turnover 1.8%
Inventory Turnover 6.0%
Receivables Turnover 213.8%
Effective Tax Rate 36.7%
Dividend TTMDividend Yield 2.32%
Payout Ratio 31.41%
Annual Dividend 0.7667
Profitability TTMGross Margin 43.8%
Operating Margin 21.2%
EBITDA Margin NA --
Profit Margin 13.5%

Teens will be teens. Young adults will continue to purchase "hip" clothing regardless of the market. The Buckle is a has strong Nebraska ties and will continue to receive strong support from the area. The Buckle continues to achieve great growth numbers and has the potential for more.

Same store sales have been terrific at this teen clothing retailer even in the face of peak oil prices. This should bode well for their booked profits. Once the roller coaster rides in the stock market is settling down, this stock should soar.

The young people, especially, are very fashion-conscious. The Buckle is a very popular store. When we lived in Nebraska, the Buckle was the place to shop. There were two in our town and others in Omaha.The prices are right and the kids all want to look great. As the economy recovers, the Buckle is positioned to gain.

Well below its moving averages, lowest P/E in its industry, growth in a recessive economy, and more and more teens are making their own income these days. Well managed and ownership has a significant stake in its holdings. Great long term play at $26.

TheBank

Retail stocks will probably be tough in this economy, but unless you are extremely pessimistic, the economy has to bounce back eventually. This stock is trading near its 52 week low, but the financials look great, and the company is slowly, but steadily expanding by adding more stores and remodeling current stores. Despite rising prices, The Buckle is still increasing sales and stores (with plenty of room to do so in the US alone).

Solid company with insane customer service. These guys know how to sell. If you've ever been in one, you know what I'm talking about. Great clothes - for teens or 20-somethings. Take it long.

Strong same store sales during tough times.

Room for growth. Currently they are only in 38 states.

High valuation relative to its historical norms, lack of margin levers, limited sq footage growth and significant reliance on other manufacturers products will lead to underperformance in '07 for BKE.

Look at this! Two out of five stars as of 12/28/06. I suggest you all go take a look at the dividends BKE pays out. They are definitely shareholder friendly. This stock is up 47% for me over the last 14 months when you take the dividends into account. A teen retailer like this usually does not offer such a generous dividend. Did I forget to mention that they have no debt? I think this is a quality retailer and is being overlooked.

This company is terrific. I have been watching it rise steadily without hesitation since April, and I am unhappy that I didn't buy in then. Their clothing lines (BKE particularly, a private label for Buckle) are very fashion forward and not too trendy (sorry, no Ed hardy $300 t-shirts here). They offer an escape from the Gap and Banana Republic for young men, and women, without having to fork over the cash they would have to at places like Nordstrom (where the over-priced Rail department offers very little variety). I see the Buckle to continue being very successful over the next year, and imagine they will start growing the business in new ways with the increased market cap and cash flow.

Good cash position. Keep on turning out profits and year over year growth in Q408 and Q109. They are shareholder friendly, manage their expensive inventory well, and carry very good products. My wife and I own a couple pair of their jeans and they do indeed fit incredibly well. This company just seems to have their act together in terms of finance and trend.

potential retail play

Excellent teen retailer, doing well in a poor economy.

a great teen stock

Sales growth is lower because prices have been raised. But higher prices mean higher margins. No worries, mate.