Let's dispatch with the easy stuff first. Sales were up 10.3% to $150.6 million, while net income was up 9.1% and earnings per share were up 15.8% because of the aforementioned share repurchases, which totaled $5.7 million during the company's first quarter. The company attributes most of the sales growth to the fact that Easter fell in the first quarter this year. I attribute the earnings per share growth to the share repurchases.
There was also the fascinating bit about the "preppy look" coming back in fashion with Sperry sales up 32% versus last year. Count me among the relieved. I've been wearing boat shoes every summer for the last 15 years. I'm glad to hear I'll finally be considered back in style outside of my small New England hometown.
All kidding aside, Stride Rite's decision to repurchase shares is a smart move, since the shares look undervalued here despite the P/E of 19. Using its last four quarters' worth of SEC filings (not including yesterday's press release), the company was trading at a very attractive enterprise value-to-free cash flow of 11.6. As the company did not provide a statement of cash flows with its earnings release, we'll need to wait a bit to see what the updated values are, but my guess is that the shares are still just as cheap.
Stride Rite doesn't have the growth of a DeckersOutdoor
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Fool contributor Nathan Parmelee does not own shares in any of the companies mentioned.