Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, furniture maker La-Z-Boy (NYSE: LZB ) has received the dreaded one-star ranking.
With that in mind, let's take a closer look at La-Z-Boy's business and see what CAPS investors are saying about the stock right now.
La-Z-Boy facts
| Headquarters (Founded) |
Monroe, Mich. (1927) |
| Market Cap |
$458.1 million |
| Industry |
Home furnishings |
| Trailing-12-Month Revenue |
$1.2 billion |
| Management |
CEO Kurt Darrow (since 2003)
CFO Louis Riccio (since 2006)
|
| Return on Equity (Average, Past 3 Years) |
(1.4%) |
| Cash/Debt |
$110.4 million / $30.9 million |
| Competitors |
Ethan Allen Interiors (NYSE: ETH )
Natuzzi (NYSE: NTZ )
|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 53% of the 268 members who have rated La-Z-Boy believe the stock will underperform the S&P 500 going forward. These bears include robertshrestha and All-Star TSIF, who is ranked in the top 0.1% of our community.
Earlier this week, robertshrestha listed several of La-Z-Boy's negatives: "Dying brand, challenging economic environment, declining fundamentals, rising costs. Nothing much to like here."
Over the next five years, in fact, La-Z-Boy is expected to grow its bottom line at a paltry pace of 4% annually. That's slower than that of industry peers like Ethan Allen (19%), Natuzzi (15%), and Leggett& Platt (NYSE: LEG ) (15%).
CAPS All-Star TSIF expands on the underperform argument:
The support for La-Z-Boy that I typically fail to factor in the several downthumbs I've given them is that they have managed to cut costs and maintain positive cash flow, even while paying debt down almost 50% in the last two years. While revenue is down over 20% the last two years, profits have been achieved, even if slightly. ...
Overall ... I think La-Z-Boy will be punished by the market if we get more volatile downward pressure and I don't think La-Z-Boy will be rewarded if we get market upside. Overall, it appears to be deadwood money. I may have missed on my "earnings call reaction", but I'm confident overall that La-Z-Boy is not an S&P contender over the next two months and most likely longer.
What do you think about La-Z-Boy, or any other stock for that matter? If you want to retire rich, you need to protect your portfolio from any undue risk. Staying away from dangerous stocks is crucial to securing your financial future, and on Motley Fool CAPS, thousands of investors are working every day to flag them. CAPS is 100% free, so get started!
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