Saturday, May 31, 2008

Tiffany’s One Person Conference Call

Tiffany & Co (TIF) announced some pretty good results. Overseas revenues were strong and the New York flagship store saw a lot of spending by European tourists. The inventory accounting system was changed and diamond sourcing was improved. All of this is incredibly important.

The only executive who could show up for the call was the VP Investor Relations who basically went through a complete MDA of the results. No analysts were on the call but if you listen to the conference call transcript he is speaking as if the analysts are there and need information to adjust their models. The average investor who probably does not have the same model capability does not know what to do with the information.

The press release was underwhelming with information. The top executives could not show up for the conference call and the analysts were not live. Just a little bit short of laughable if you ask me.

Wednesday, May 28, 2008

Learning Tree For Sale

Learning Tree International (LTRE) has struck a committee of independent investors and put the company up for sale. Learning Tree has spruced itself up solving some previous problems and essentially losing some weight before she starts to date a little bit. Officially the major shareholders wish to liquidate or liquefy their investment (never really sure which phrase nuances correctly) and also to be generous to their charitable interest.

The problem with this entity is the lack of information. I do not mean the briefing book that the board is preparing. If you search through historical financial disclosure you will see plentiful product announcements which need to be parsed to determine marketing and therefore revenue information. You have no commentary about market trends, cycles and opportunities. Basically they explain if the seats in the school are full or not. Similar to what airlines do with load factors.

So if you have been following the stock do you really understand the fundamentals or do you just trust to greed and hope that the majority owners want the largest pile of cash. The Board has a very high ratio of consultants. The corporate website does not provide any substantive information on board member’s resumes and experience backgrounds.

I know they will be peddled. But how good a deal will it be?

Tuesday, May 27, 2008

Aeropostale Shrinking Cash Position

Aeropostale Inc (ARO) which bills itself as a mall-based specialty retailer of active and casual apparel for young men and women reported improved earnings and a 10% increase in same store sales. This compares very nicely to an increase of 3% in the year-ago period. Overall sales increased by 22%.

Julian R. Geiger, Chairman and Chief Executive Officer said, “We are thrilled with our record first quarter performance and solid start to fiscal 2008. Our spring merchandise assortment was very well received and Aéropostale continues to gain brand preference among teen customers. During the quarter we remained committed to striking the right balance between fashion and value, while appropriately managing our inventory levels. As we head into the second quarter and important back-to-school selling season, we believe we are well positioned to continue to capture additional market share.”

That’s it. They nailed the merchandising strategy, finding the sweet spot between value and fashion. Catering to the teenage crowd that is quite an achievement.
They left out a few things. No substantive comment was made on store opening strategies. Also no comment was made on the radically shrinking cash position.

If these guys want to build a loyal following they will have to increase the transparency and start to engage investors. What happens when you miss the merchandising strategy how does an investor maintain confidence.