Pacific Sunwear of California, Inc. (PSUN)

I was long this company up until recently and I no longer believe in its future. PSUN has lost it's identity that allowed it to grow in the 90s and early 00s. They are no longer the "go-to" destination for young 'surfer/skate-boarding' teens and are now struggling to recapture those shoppers and probably never will. Management turnover is another serious concern for this company. They are on their 3rd CEO in the last 6 years. Each one keeps reversing the previous CEO's directions with little success. The company is in the middle of a serious store contraction, going from over 950 stores about 2 years ago to a recent count of 900 projected by year-end and the CEO targets 750-800 in the next 3 years. Sales continue to decline at a staggering double digit % clip. While the company is debt free and has a small cash position, there is no guarantee that with continuing decline in sales and consistent EPS losses they can cut expenses further to avoid borrowing and possibly issuing more shares and diluting current owners. I would avoid this stock until sales stabilize and start showing gains. With the current economy, I don't see this happening for another 3 years.