I focus on the fundamental research call and Keith drills the timing and sizing. We don’t always agree -- which results in debate that ultimately boosts our batting average. KM called out a few names to me over the past 24 hrs, and we’re in perfect synch on these puppies.
LIZ CLAIBORNE (LIZ)
KM: LIZ finally washed out, buy it under 10.07, patiently.
BM: The sell off in conjunction with JNY’s miss makes sense. But LIZ is cutting capex by more than people think in 2009, and SG&A cuts will follow. This will become apparent in 1Q. Maybe a bit early now, but there’s well over $1 in EPS power here.
COLUMBIA (COLM) AND TIMBERLAND (TBL)
KM: COLM looks like TBL, a buy in the washed out hole.
BM: I like TBL better from a fundamental standpoint, and still think it is more likely than not that it will be owned by another company in 12 months. COLM has structural challenges given the incremental growth it is pushing in sportswear -- a crowded and commoditized category. But COLM has been gaining share in the sporting goods channel over the past month, which is one of the first times in a while I recall COLM do anything other than lose share.
GUESS? (GES) AND WARNACO (WRC)
KM: GES looks the same as WRC, wackamole on all strength. (Note: KM noted this to me post close yesterday – before Wednesday’s downward move. He’s still bearish).
BM: I’ve been vocal on both of these names, but fundamentally view WRC as being much worse off than GES. I still can’t get over how WRC can have some of the poorest returns and brand portfolio, yet among the highest multiples in the group.
LIZ CLAIBORNE (LIZ)
KM: LIZ finally washed out, buy it under 10.07, patiently.
BM: The sell off in conjunction with JNY’s miss makes sense. But LIZ is cutting capex by more than people think in 2009, and SG&A cuts will follow. This will become apparent in 1Q. Maybe a bit early now, but there’s well over $1 in EPS power here.
COLUMBIA (COLM) AND TIMBERLAND (TBL)
KM: COLM looks like TBL, a buy in the washed out hole.
BM: I like TBL better from a fundamental standpoint, and still think it is more likely than not that it will be owned by another company in 12 months. COLM has structural challenges given the incremental growth it is pushing in sportswear -- a crowded and commoditized category. But COLM has been gaining share in the sporting goods channel over the past month, which is one of the first times in a while I recall COLM do anything other than lose share.
GUESS? (GES) AND WARNACO (WRC)
KM: GES looks the same as WRC, wackamole on all strength. (Note: KM noted this to me post close yesterday – before Wednesday’s downward move. He’s still bearish).
BM: I’ve been vocal on both of these names, but fundamentally view WRC as being much worse off than GES. I still can’t get over how WRC can have some of the poorest returns and brand portfolio, yet among the highest multiples in the group.
