A Photo Finish

Last month, a fleet of foot stocks were investigated, from powerhouse Nike (NYSE: NKE  ) to pint-sized Stride Rite (NYSE: SRR  ) . Today, following the release of its latest results, we will look into a company that helps bring the manufacturer's shoe to the consumer's foot -- Finish Line (Nasdaq: FINL  ) .

Total fourth-quarter sales were solid, growing 10.5% from the same period a year ago, with new store openings fueling most of the top-line growth. Finish Line added 66 new stores, increasing its unit count by 10% in fiscal 2006.

Sales from stores open more than a year were of little help, however, since comps for the period were flat year over year. Finish Line's struggles with its women's business were one significant reason for the slump. Women's fashion tastes are moving away from performance and athletic styles, toward boots, sandals, and low-profile options. On top of this developing trend, Finish Line is facing increased competition from fellow mall residents vying for this demographic.

On a positive note, the company is seeing strong results in its men's and kids' businesses. Finish Line plans to increase the presence of brands like Puma and Pony to keep momentum in the kids' market. Men's sales are doing well, particularly in the running and performance categories. New Nike product introductions in fiscal 2007, including a retro Michael Jordan shoe, will keep sales in this category strong.

With the men's and kids' categories performing nicely, the company will be concentrating its efforts on improving women's sales. This strategy includes a new store concept, set to launch this spring, called Paiva. Just as Finish Line has targeted men using its Man Alive stores, it will use Paiva to target fashion-conscious women. Initially, it plans to open sites in some of the most well-trafficked malls in America.

Beyond improving women's sales, Finish Line's growth strategy will also rely on expanding its direct-to-consumer operation. has been the fastest-growing unit for the company, growing sales by 40% in fiscal 2006. The company expects online sales to remain strong in the quarters ahead.

Finish Line will face some challenges in fiscal 2007 as it tries to ramp up sales in its women's division. Even so, earnings and revenues are expected to grow at a double-digit blended rate of roughly 12% this year. With the market recently cooling on Finish Line's shares, this provides an opportunity to take a closer look at what may be a solid long-term investment.

Lace up additional Foolishness:

Fool contributor Jeremy MacNealy does not have any financial interest in any companies mentioned.

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 512509, ~/Articles/ArticleHandler.aspx, 10/24/2016 6:29:34 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 2 days ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:02 PM
DKS $56.78 Up +0.07 +0.12%
Dick's Sporting Go… CAPS Rating: ***
FINL $20.80 Up +0.02 +0.10%
The Finish Line CAPS Rating: **
NKE $51.77 Down -0.12 -0.23%
Nike CAPS Rating: *****
WWW $20.97 Down -0.20 -0.94%
Wolverine World Wi… CAPS Rating: *****