A lot happened to The Knot between the Oct. 26, 2005, downgrade and Monday's eventual upgrade. The company wound up producing more-than-respectable financial results. It was able to cool down its legal tussle with WeddingChannel.com. It was singled out as a recommended stock to Rule Breakers subscribers. And, of course, the stock also happened to jump 51% higher.
JPM wasn't the only company on the wrong side of untying The Knot. Four months ago, TheStreet.com's (NASDAQ:TSCM) Jim Cramer dug into the company in Mad Money.
"I wouldn't chase this stock in the low teens, as it has already gained more than 150% on the year," Cramer argued.
It's flawed logic, of course. Just because a stock has risen in the past does not mean that it won't keep rising in the future. It bears noting that if 150% is such an impressive number, then the company's ability to grow earnings per share by 220% in 2005 should be quite the head-turner. With yesterday's close of $18.69, the stock has gone from the low teens to a consenting adult, inching more than 40% higher along the way.
The Knot's popularity is as simple as understanding the nature of its traffic. With fiancees looking to drop some serious amounts of money on their weddings, everyone from catering-hall managers to mullet-sporting wedding singers pay for representation on The Knot.
The Knot has launched other sites like PromSpot, which taps a younger, more naive audience: kids willing to pay to look their best for their high school proms. There is also The Nest, a spot dedicated to newlyweds making many of their first decisions together.
Along the way, The Knot has struck content-streaming deals with Comcast (NASDAQ:CMCSA) and a credit card product with American Express (NYSE:AXP). The shares may not seem cheap these days, but the company continues inching closer to the airborne floral bouquet.
With performance like this, even JPM should be applauded for a second shot at love.
The Knot has risen 58% since being recommended toRule Breakersnewsletter service subscribers earlier this year.
Rick has only been married once -- and once should be enough for him. He recommendsThe Motley Fool's Guide to Couples and Cashas required relationship reading and he does not own any of the shares mentioned in this story. He does not own shares in any of the companies mentioned in this story.The Fool has a disclosure policy. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
