Zumiez Inc. ($ZUMZ) Cautious Buy or Hold to $37 Confident Investor Rating: Fair

Company name Zumiez Inc.
Stock ticker ZUMZ
Live stock price [stckqut]ZUMZ[/stckqut]
P/E compared to competitors Fair

MANAGEMENT EXECUTION

Employee productivity Poor
Sales growth Fair
EPS growth Good
P/E growth Poor
EBIT growth Good

ANALYSIS

Confident Investor Rating Fair
Target stock price (TWCA growth scenario) $32.91
Target stock price (averages with growth) $51.67
Target stock price (averages with no growth) $49.93
Target stock price (manual assumptions) $32.92

The following company description is from Google Finance: http://www.google.com/finance?q=zumz

Zumiez Inc. (Zumiez) is a specialty retailer of action sports related apparel, footwear, equipment and accessories operating under the Zumiez brand name. As of January 28, 2012, the Company operated 434 stores in the United States and 10 stores in Canada. In addition, the Company operates a Website that sells merchandise online. At January 28, 2012, its stores averaged approximately 2,900 square feet. Its apparel offerings include tops, bottoms, outerwear and accessories, such as caps, bags and backpacks, belts, jewelry and sunglasses. Zumiez’s footwear offerings primarily consist of action sports related athletic shoes and sandals. Its equipment offerings, or hardgoods, include skateboards, snowboards and ancillary gear, such as boots and bindings. The Company also offers a selection of other items, such as miscellaneous novelties.
Confident Investor comments: At this time, I think that a Confident Investor can cautiously invest in Zumiez Inc. as long as the price is correct. Most of the fundamentals of this company are good but there are some concerns.

If you would like to understand how to evaluate companies like I do on this site, please read my book, The Confident Investor. You can review the best companies that I have found (and I probably invest my own money in most of these companies) in my Watch List.

How was this analysis of Zumiez Inc. calculated?

For owners of my book, “The Confident Investor” I offer the following analysis (you must be logged in to this site as a book owner in order to see the following analysis). If you have registered and cannot see the balance of this article, make sure you are logged in and refresh your browser.
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In order to assist you in using the techniques of this book, the values that I used when calculating the Manual pricing above were:

  • Stock price at the time of the calculation: $27.32
  • Growth: 0.14
  • Current EPS (TTM): $1.53
  • P/E: 18
  • Future EPS Calc: $2.94
  • Future Stock Price Calc: $53.02
  • Target stock price: $32.92

I hope that this makes you a better investor. [/s2If]

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