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Best Apparel Stocks Ever!. Alyssa Ahlers Courtney Andre Brian Balkovec Trevor Ballinger. BAs. Overview. Companies Chosen: JC Penney, Inc. (JCP) Abercrombie & Fitch Company (ANF) Nordstrom, Inc. (JWN) Limited Brands, Inc. (LTD) Gap, Inc. (GPS) Why? Diverse offerings.
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Best Apparel Stocks Ever! Alyssa Ahlers Courtney Andre Brian Balkovec Trevor Ballinger BAs
Overview • Companies Chosen: • JC Penney, Inc. (JCP) • Abercrombie & Fitch Company (ANF) • Nordstrom, Inc. (JWN) • Limited Brands, Inc. (LTD) • Gap, Inc. (GPS) • Why? • Diverse offerings
JC Penney, Inc. (JCP) 5 Year Price Graph
JC Penney, Inc. (JCP) www.morningstar.com
JC Penney, Inc. (JCP) As of 5-1-09 from www.morningstar.com
Why JCP? • Diversified through selling in brick-and-mortar stores, on-line, and catalog sales • 40% of merchandise is private label • Better than average performance of the department store industry in the past five years
Abercrombie & Fitch, Co. (ANF) 5 Year Price Graph
Abercrombie & Fitch, Co. (ANF) www.morningstar.com
Abercrombie & Fitch, Co. (ANF) • Leader in the clothing industry • Healthy number of competitors • Medium-sized player in the industry = room for growth • Very strong profit margins
Nordstrom Inc. (JWN) 5 Year Price Graph
Nordstrom Inc. (JWN) www.morningstar.com
Nordstrom Inc. (JWN) • Leader in the department store industry • Relatively small number of competitors • One of the largest players in the industry • Steady growth in the past 3 years and very strong profit margins
Limited Brands Inc. (LTD) 5 Year Price Graph
Limited Brands Inc. (LTD) www.morningstar.com
Limited Brands Inc. (LTD) • Leader in the clothing industry • Consistently increasing returns over the past 5 years • Company’s net profit margins are average compared to the industry = recession proof
Gap Inc. (GPS) 5 Year Price Graph
Gap Inc. (LTD) www.morningstar.com
Gap Inc. (LTD) • Dominate the clothing industry • Remains profitable and generates solid free cash flows • Diversified through Old Navy, Gap, Gap Kids, Baby Gap, Gap Body, Banana Republic • Earnings per share (EPS) have grown at a very fast pace over the past 3 years
Conclusion • Stick with our 5 choices and you will be making money in the department and clothing industries! (Contrary to much publicized belief )