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5-Star Stocks Poised to Pop: Iconix Brand Group

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, brand management company Iconix Brand Group (Nasdaq: ICON  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Iconix's business and see what CAPS investors are saying about the stock right now.

Iconix facts

Headquarters (Founded) New York (1978)
Market Cap $1.7 billion
Industry Apparel footwear and accessories
Trailing-12-Month Revenue $353.2 million
Management Founder/Chairman/CEO Neil Cole
CFO Warren Clamen
Return on Equity (Average, Past 3 Years) 10.5%
Cash / Debt $96.1 million / $519.5 million

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 96% of the 264 members who have rated Iconix believe the stock will outperform the S&P 500 going forward. These bulls include Nerus and streeter123.

Late last month, Nerus offered a mouth-watering price forecast on Iconix's shares: "Good earnings track record. At 1.65 EPS [full-year 2011 estimate], times P/E of 20 (raising from current 18 due to consistently good growth), stock will be around 33 in 12-16 months."

Iconix even boasts a robust three-year average operating margin of 63.7%. That's much higher than that of other brand apparel plays like Gap (NYSE: GPS  ) (12.4%), Guess? (NYSE: GES  ) (16.9%), and Nike (NYSE: NKE  ) (13%).

CAPS member streeter123 expands on the Iconix outperform argument:

- Peanuts/Dilbert/Fancy Nancy licensing. Fancy Nancy is really taking off, especially. I'm really surprised there is no TV show yet.
- A nice mix of high fashion (i.e. Badgley Mishka), regular brands (i.e. Starter) and "cool" brands (i.e. Rocawear)
- Good FCF, low PEG

What do you think about Iconix, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Nike and creating a modified stock repair position in Guess?. The Motley Fool owns shares of Guess?. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


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DocumentId: 1499219, ~/Articles/ArticleHandler.aspx, 5/27/2012 11:52:13 PM

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Related Tickers

5/25/2012 4:00 PM
ICON $15.48 Up +0.25 +1.64%
Iconix Brand Group… CAPS Rating: ****
NKE $108.79 Up +1.31 +1.22%
Nike CAPS Rating: ****
GPS $27.16 Up +0.17 +0.63%
Gap CAPS Rating: **
GES $27.11 Up +0.41 +1.54%
Guess?, Inc. CAPS Rating: ****

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