Investors have been spooked by many retail stocks here lately, but judging by its latest quarter, Buckle
Fourth-quarter net income increased 31.7% to $29.1 million, or $0.94 per share. Sales jumped 18.3% to $207 million, and same-store sales increased 18.7%. That beat analysts' profit expectations by $0.09 per share, while revenue was right in line with expectations.
Improvement in the merchandise margin and leveraging buying occupancy and distribution costs allowed the gross margin to increase by 120 basis points to 44.4% of sales, vs. 43.2% this time last year.
Even more tantalizing, Buckle upped its cash by 10.4% to $167.2 million and put some of this cash to good work paying out a 2.19% dividend.
It might seem like other teen retailers such as Zumiez
With just 370 locations, I'm not sure I've ever even noticed a Buckle while shopping. But apparently, its young clientele has responded well to it. Although it offers apparel, accessories, and footwear, denim's a key component of its merchandise.
Denim's admittedly been hot, but it's also available in so many places, from huge department store retailers like Macy's
Of course, Buckle currently trades at 20 times trailing earnings, and that sounds pricey compared to many retail stocks' price-to-earnings ratios at the moment. Still, there's always the argument that you might pay a higher price for a company that's performing so well, despite difficult times, and pays out a dividend, too. Although Buckle seems like a well-run company that's still firing on all cylinders, I can see why value-minded investors might want to wait for temporary weakness in price to pick up some shares.
Buckle up for some news from Buckle last year:
Zumiez is a Motley Fool Hidden Gems recommendation. American Eagle Outfitters and Gap are Stock Advisor picks, and Gap has also been recommended by Inside Value. The Fool owns shares of American Eagle.