Important Updates for Investors
Carla Pasternak's Premiere Issue of High-Yield International Just
Released
Income expert Carla Pasternak's debut issue of High-Yield
International covers a Taiwanese manufacturer yielding 9.5%... a
rare Mexican monopoly yielding 13.4%... and other top-performing
investments yielding up to 19.0%.
Government's Biofuel Timetable Could Spell +15,900% Growth
+15,900% growth might seem far-fetched... but it's not. In fact, it
is mandated by law. And I've identified the ONLY stock positioned to
capture this growth.
The
Silver Lining to a Falling Dollar
Despite the U.S. national debt, there is a silver lining for income
investors. This massive spending, combined with movement out of U.S.
Treasuries, is going to take its toll on the dollar, and
international income investors could reap the rewards in the form of
higher dividends. |
|
|
|
| Top
Ten Stocks for 2005 and Beyond |
Published: January 1, 2005
Important Note:
Below you will find the first several pages of an in-depth 30-page
special report entitled "StreetAuthority's Top Ten Stocks for
2005 and Beyond." In this brand new report StreetAuthority.com
founder Paul Tracy and his staff introduce readers to ten stocks that
they feel are poised to deliver above-average returns not only
throughout the 2005 calendar year, but also in the years that follow.
The report starts out with a brief summary of the various criteria that
Mr. Tracy and his staff look for in a quality long-term investment.
Among other things, these include:
-- Sustainable Competitive Advantages
-- Strong Financial Track Records
-- Catalysts, or Growth Drivers, that will Fuel Future Earnings and
Share Price Gains
-- A History of Market-Beating Returns
-- Promising Future Outlooks
The report then moves into a detailed profile of each company. In the
process, Mr. Tracy and his staff explain why they believe each of these
ten high-quality stocks will deliver superior returns in the years
ahead.
We sincerely hope that you benefit from the following investing ideas
and analysis. Although we're happy to provide you with one
company profile from this report at zero charge below, please note that
to read the full version of this report, which contains an
in-depth look at nine other high-quality stocks, you'll need to
subscribe to our “Market Advisor” newsletter. To learn more about
that publication, which is completely separate from this complimentary
newsletter, please visit the following link:
https://www.streetauthority.com/subscribe-ma-49.asp
---------------------------------------------
SAUCONY (SCNYB)
Business Overview
Saucony designs and sells footwear and athletic apparel under four main
brands: Saucony, Saucony Originals, Hind and Spot-Bilt. Although the
company sells some casual footwear, its main focus is clearly on
athletics and, in particular, running and walking shoes for both men and
women. That includes shoes with highly specialized features, such as
arch and ankle support for runners experiencing foot pain.
Outside the running shoe business, Saucony also produces specialized
shoe products like soccer and football cleats. Meanwhile, through its
Hind brand name the company sells athletic apparel such as sports bras
and sweat-resistant shirts.
Competitive Advantages
There are many competitors in the shoe and athletic apparel businesses,
many of which are much larger than Saucony -- Nike and Reebok, among
others, spring to mind. Despite this, however, Saucony's competitive
moat is a lot wider than you might at first imagine.
More specifically, the company has garnered a solid reputation and a
loyal, almost cult-like following among a core base of devoted running
fans. This highly profitable niche business isn't fully exploited by the
big athletic shoe manufacturers. And because reputation and brand
loyalty among the most committed athletes is high, it would be very
difficult for the likes of Nike to attack this niche effectively.
One of the easiest ways to gauge the strength of a consumer brand
franchise is to watch trends at the retail level. Specifically, watch
how many retailers stock a particular brand and what a retailer's
perception of the brand is. On both measures, Saucony scores well.
A poll conducted by Sports Marketing Survey at the end of 2004 showed
that 62% of the retailers surveyed had decided to carry Saucony's
running shoe brands, up +11% from 2003 levels. That represented the
largest jump in retail penetration among any running shoe brand. Even
better, a majority of retailers stocking Saucony shoes reported that
they planned to stock more of the company's products in 2005.
As for brand perception, the same survey was enlightening. Over 90% of
retailers characterized Saucony's brands as "performance"
running shoes. That number is up well over +30% from what the same
survey revealed in 2000. These strong numbers are a testament to
Saucony's strong brand reputation in the high-performance athletic shoe
business.
Growth Drivers
Going forward, Saucony's growth will be fueled by two main factors: an
improving product mix and increased retail store penetration.
On the retail side, as we explained above, it's clear that more
retailers are stocking Saucony brands. Simply put, that means the
company is putting its products in front of more and more consumers
every year. And this trend could carry on for some time. Although over
60% of retailers carried Saucony products in 2004, it's not difficult to
imagine that figure eventually jumping up to over 90%, especially given
the popularity of the firm's brands. This increased exposure should
result in higher sales in the years ahead.
But equally important is the company's changing product mix.
Specifically, throughout 2004, Saucony experienced greater demand for
its specialized running shoes than its more traditional cross-trainer
lines, which it markets mainly under its "Saucony Originals"
line. The company also has a sizeable backlog of orders for 2005 -- most
of the backlog is for more advanced, high-performance shoes.
High-performance lines carry fatter profit margins than simple
cross-trainers. That should come as little surprise, as there is far
more competition in the cross-trainer business than in the more
specialized niche running shoe business. The fact that the company is
seeing its fastest sales growth from higher-margins shoes is a major
positive, and this change in mix has been behind Saucony's consistent
margin expansion over the past several quarters.
Bottom line: Saucony is set to experience higher sales growth due to
better exposure. And because the company's business mix is shifting
toward more lucrative running shoes, each dollar in incremental sales
will result in higher profits for shareholders.
Valuation and Outlook
Wall Street analyst coverage of Saucony is virtually nonexistent. In
fact, there are no published earnings estimates for this relatively
unknown firm. As a result, institutional players own less than 15% of
the company's outstanding shares -- an unusually low figure even for a
small-cap stock like Saucony. This should be a huge positive for the
stock in the years ahead -- as institutions catch on to the company's
impressive growth rate, they're likely to start buying up shares.
My staff and I believe that
Saucony can post earnings growth in the +20% to +25% range throughout
the next several years. Although that's slightly below the growth rate
that the company has experienced over the past few years, it's
considerably higher than the industry average. By comparison, analysts
expect Reebok (RBK) to post long-term growth of around +14% and for Nike
(NKE) to deliver annual earnings gains of closer to +13.5% --fully 10
percentage points less than Saucony.
Despite the firm's much stronger growth profile, however, Saucony has
tended to trade at a steep discount to the likes of Nike and Reebok. On
a price-to-earnings basis (P/E) that discount has been as high as 50%
over the last few years. We think this valuation disparity will
disappear in the years ahead as Wall Street finally gives Saucony the
exposure and recognition that it deserves. In the meantime, investors
have a great opportunity to snap up a high-growth stock at a bargain
price.
---------------------
Receive A Full Year of our Market Advisor newsletter for Only $49.95
In the text above we have provided you with information on only one
of our favorite stocks for 2005 and beyond. Subscribe to our Market
Advisor newsletter at our 75% discounted holiday rate of only $49.95
per year and you'll receive immediate access to this full report --
"StreetAuthority's Top Ten Stocks for 2005 and Beyond"
-- as well as up to nine other research reports. You have nothing to
risk and you'll gain immediate access to our Market Advisor
newsletters, model portfolios and a host of other valuable equity
research.
To receive your copy of this full report, as well as a full year of our
Market Advisor newsletter at a 75% discount, please visit the following
link:
https://www.streetauthority.com/subscribe-ma-49.asp
|
|
|
Please Note: The above article was merely a
small excerpt from an issue of our premium, long-term-oriented investing
newsletter -- the Market Advisor. To receive your copy of
our most recent Market Advisor newsletter, as well as other
guidance similar to this every other week, you'll need to subscribe to this
publication. To learn more, please visit the following link: https://www.StreetAuthority.com/subscribe-ma.asp |
|
|
Investing Doesn't Get Any Easier Than This |
Stock picker Amy
Calistri's strategy is as simple as investing gets -- just one idea
a month designed to make money in today's market. Invest this way
and you don't have to worry about oil prices, automaker bailouts, or
what the Fed is up to -- because every "bad" economic development
actually helps some investment or another.Your investing life can
get a lot simpler -- starting today.
Go here to learn about Amy's simple investing strategy.
|
|
|
Special
Deal for Our Web Site Visitors
