The Motley Fool and its crew of wave-riding investing junkies have tracked Quiksilver (NYSE:ZQK) throughout the year. We've seen the company catch air with outstanding top-line growth. Then we saw it wipe out in an avalanche of inventory from its acquisition of Rossignol. And finally, we found out that although this acquisition does have a silver lining, and a gold one, and a diamond one, they're not for the company's shareholders, but rather for Rossignol's Boix-Vives family.

Now that Quiksilver's stock has rebounded by 18% off 52-week lows, does its fourth-quarter report offer any hints of a salvageable investment for shareholders? Let's dive in, dudes.

The company's top line continues to shine, with net revenues increasing 82% to $637.4 million. But $214.5 million of these sales are attributed to the above-mentioned acquisition that became effective on July 31. If you back out Rossignol's contributions, net sales from continuing operations were $422.9 million, higher by a still-respectable 20.7%. The key question here is whether this growth is good enough in light of the inventory situation.

If you look only at continuing operations, inventories increased mildly by 5%. With the inclusion of Rossignol, however, this same metric ballooned by 115%. Bernard Mariette, president of Quiksilver, was satisfied with the integration process of the Rossignol brands, but I share the same sentiment as my colleagues -- this bears a wait-and-see approach.

Many times, a company will have to resort to price-slashing to get rid of excess inventory. And price-slashing, in turn, reduces gross profit for the goods sold. It's possible that this scenario is already taking place -- Quicksilver's cost of goods as a percentage of revenues for the quarter is up to 54.9%, from the year-ago level of 52.3%. What we don't know right now is whether that's simply the effect Quiksilver's higher gross margins merging with lower gross margins from Rossignol's brands, or whether it's a sign that excess inventory is already being sold off at reduced prices. It could be a combination of both.

Analysts were apparently accounting for some saturation of margins, as the company met Wall Street's earnings projection of $0.27 per share. And looking forward, it appears that analysts see a continued reduction in profitability: The expectation is that Quiksilver will attain $0.87 per share in fiscal 2006, just a penny higher than fiscal 2005's mark.

In light of this situation, I would be hesitant to pull the trigger on this investment. There's no harm in waiting, or in letting Quiksilver's management prove that its optimism over the Rossignol acquisition is justified. With Quiksilver's inventory situation and the anticipated reduction in profitability in the upcoming year, it's conceivable that the market will present other buying opportunities for this stock.

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Fool contributor Jeremy MacNealy does not own shares of any companies mentioned.