'Tis the season for retailers' holiday sales. However, investors can also look for major bargains right now in retail, and here's one example: Buckle's
This youthful teen retail stock's taken a bit of a beating from its recent highs. In the last year, Buckle's shares had risen to around $48, but they're now trading at less than $40. The retailer took a drubbing after its most recent quarterly tidings, which is, in a word, bizarre. Buckle increased its third-quarter net income by 11% to $38.3 million, or $0.81 per share. Sales rose a healthy 12% to $273.4 million, and same-store sales surged by 9%.
This is great performance in the current economic climate, and those results even beat analysts' expectations, but still, apparently that wasn't good enough for many investors. Nor was Buckle's 6.9% increase in same-store sales in November.
There's a lot to like about Buckle, including some lesser-known initiatives that help it compete with retail rivals like Abercrombie & Fitch
Buckle consistently keeps its youthful clientele coming back for more by intentionally stocking clothing that's different than that of rivals, building cred with fashion-forward young people. It carefully monitors its merchandise to track what's working for its customers (and to limit what's not), offering major high-end brands like Guess?
If many investors have unbuckled themselves from Buckle recently, they're missing out on the big long-term picture regarding a very well-run retailer. As for the current opportunity, Buckle's trading at just 12 times forward earnings -- about in line with the multiples attached to rivals like the ones noted above -- and a PEG ratio of a reasonable 1.12. Meanwhile, its current share price weakness seems detached from the reality of its recent impressive financial performance, making this stock a great bargain right now.
Here's an easy way to keep up with the ever-changing, fickle retail universe: