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Retailer, manufacturer and marketer of branded home furnishings.
Standard & Poor's INDUSTRY OUTLOOK = NEUTRAL :We have a neutral fundamental outlook on the home furnishings sub-industry for the next 12 months. We believe industry sales will rise at a mid-single-digit rate in 2014, driven by the rebound in the U.S. residential housing market. Standard & Poor's Economics estimates U.S. housing starts for 2014 at 1.14 million, up 25% from 910,000 projected for 2013. However, the pace of new housing construction has slowed down recently due to higher mortgage rates.We expect housing renovation activity to pick up, given the rise in home values. Consumer confidence has been trending up for the past couple years. The Thomson Reuters/University of Michigan index of consumer sentiment rose to 82.5 in December from 75.1 in November. The labor market has been improving, adding about 200,000 new jobs per month.However, we believe not all segments of the home furnishings market will experience similar growth. While the overall economy is growing, some consumers are being hurt by the higher payroll taxes and are paying down their debt. We project slight volume declines in the mid-tier segment, as some customers trade down. Meanwhile, we think the more affluent ones are less affected by the higher payroll taxes because they derive more of their wealth from investments. Thus, we believe the high-end of the home furnishings market will continue to outperform the industry,We believe American home furnishings companies have become more competitive by improving their manufacturing facilities. These companies are upgrading existing stores and factories instead of building new ones. After industry consolidation of a number of furniture retailers in 2009 and 2010 brought on by bankruptcy filings, we look for the larger publicly traded home furniture companies to gain market share, while widening their operating margins from improved inventory controls.In 2013, the S&P Home Furnishings Index rose 50.8%, versus a 30.1% increase for the S&P 1500 Index. The home furnishings sub-industry includes major companies such as Ethan Allen Interiors, La-Z Boy, Mohawk Industries and Leggett & Platt.
Insider and institutional buys, strong surge likely to continue.
Trades below net tangible assets, growing revenue double digits, an EV/revenue below 0.5, and a low P/E. They are also buying back shares. Strong net cash position.
Long term, it pays dividend, plus a couple of special dividends.
Good Earnings, Quality Product, Growing Market Cap, Good P/E Ratios, Solid investment
The company has had a huge cash inflow from the earlier sale. There is another potential $9 million from the trade suit with China.They have really focused on closing bad stores and cleaning up the books.Housing seems to be on a slow uptick. If money becomes more available and if mortgage rates begin to show a bit of a rise, there could be an influx of buyer trying to pick up homes at the bottom.There is a older, small neighborhood near mine. A flipper came in, picked up a bank sale at $90,000, put in about $10,000 in landscaping and paint. listed and $170,000 and sold the first week shown at $166,000. (1400 sf with pool)Market may be creaping back on the lower end.
Looking for bargains. This looks like one with good balance sheet and low price.
worst furtniture store ever
home furnishings and fixture sectormortgage problems kills furnishings
price less than book value, makes it a buyout target during a down cycle in consumer goods
Revenues dropping, earnings dropping. People already bought the furniture they need for their new houses, and now they are spending their money servicing that debt. As Mr. Burns would say,"Release the hounds".
Bassett Furniture is engaged in manufacturing, marketing, and retailing of branded home furnishings in the United States, Canada, and internationally. The Company operates through wholesale and retail segments. The wholesale segment contributes about 80% of the revenues. The retail segment consists of 135 stores, 26 of which are owned stores and the rest are partnership licensee stores. In Q3’06, Net Revenues declined by 6.3%; wholesale segment declined by 8.3 %, and retail segment showed a flat trend on a year-over-year basis. Gross margins declined by 5.9% year-over-year as a result of soft retail conditions and clearance sales. New housing unit sales have also shown declining trend which is expected to continue. Due to the downturn in housing sales and increasing competition in the industry it is expected to negatively impact the company.To counter the situation of declining revenues and margins, the company is adopting a strategy of growing company-owned stores and expects to increase number of stores to 250 to 300 by 2007. The Company also expects to shift its domestic versus imported product to contain a 50/50 mix over the next two years, which is expected to positively impact company’s operating margins then. Despite the initiatives taken by the company, we believe that the company would underperform given the softness in the housing sales and the increasing competition.
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