HELE

[mrmarket]

Message 10 of 14
Subject: $$$MR. MARKET$$$ Loves HELE
Date: 9/3/2003 10:25 PM Eastern Standard Time
From: EBarsamian
MsgId: <20030903222536.07544.00035658@mbs-m03.aol.com>



So you call up your best girl and she tells you that she can’t go out with you because she has to wash her hair. Maybe those girls are always washing their hair, or maybe you just don’t give good wood. Whatever the reason, all that hairwashing makes for some good stockpicking.

Today I bought Helen of Troy Limited (HELE) at 24.13. I will sell it in 4 to 6 weeks at 27.87. Here’s why I like HELE:

-The stock is up over 81% over the last year yet it has a PE of only 14.

Earnings are growing and Wall Street is lapping it up. Chances are, you have HELE stuff in your house right now. HELE also raised its profit projections for the full year to a range of $1.75 to $1.80 a share, up from an earlier forecast of $1.45 to $1.50, and announced a generous stock buy back program.

The CEO, Jerry Rubin, has been out on the dog and pony show pumping the company and Wall Street is listening. Listen to him crow: "This marks our tenth consecutive year of first quarter sales increases, and we are extremely pleased with the results achieved in this difficult retail sales environment. Sales increased in every segment of our business, excluding Tactica. Gross margins increased to 49.6 percent from 48.3 percent last year. First quarter operating income increased 5.4 percentage points to 15.2 percent of net sales from 9.8 percent a year ago. First quarter net income increased 7.5 percentage points to 13.9 percent from 6.4 percent a year ago.

"For the fiscal year ending February 28, 2004, we expect overall sales to increase 9 to 12 percent, to a range of $500 to $515 million. We are raising our fiscal year earnings per share guidance to $1.75 to $1.80, from $1.45 to $1.50, or 34 to 37 percent increase from prior fiscal year's earnings per share of $1.31. Year-over-year sales have increased in 34 of the past 37 quarters, with net income increasing in 33 of these 37 quarters, which we believe demonstrates a consistent financial performance during the past nine years. Because of our continuing confidence in the future performance of the company, our Board of Directors' has authorized a Stock Repurchase Program consisting of 3,000,000 shares, effective immediately," Rubin concluded.

Helen of Troy's core products include personal-care appliances, such as hair dryers and curling irons, which are sold under the Vidal Sassoon and Revlon brand names at discount retailers. Have you checked out MTV lately, not only women, but men are primping themselves these days. That could be a 50% growth in available customers for this stuff.

Helen of Troy has indicated it may consider acquisitions of small brands out of large, multinational consumer-products companies, though no names were mentioned. Today they just bought Brut from Unilever. I love Brut. I apply it liberally all over my massive physique.

HELE always beats their numbers and should have no problem blasting the $1.80 per share number they most recently through out there. If they hit $1.95, as $$$MR. MARKET$$$ believes they will, this should catapult HELE stock to $27.30/share, using the P/E multiple of 14 they presently carry.

So what’s so special about Helen of Troy? Helen of Troy is at the center of one of mythology's greatest love stories. Two great civilizations, the Trojans and the Greeks/Spartans, led by two men (Paris and Agamemnon respectively), battled for almost 10 years over the love of one woman: Helen. Those guys, Paris and Agamemnon were a couple of losers. They should have spent a week in Vegas and instead would be saying “Helen who?” as they chomp on Partegas Cigars and sample life’s finest hedonistic activities.

I am HUGE!! Bring me your finest meats and cheeses!

$$$MR. MARKET$$$

Reuters
Helen of Troy earnings jump nearly 50 pct
Thursday October 2, 7:55 am ET


NEW YORK, Oct 2 (Reuters) - Helen of Troy Ltd. (NasdaqNM:HELE - News), a personal care products company, on Thursday said quarterly earnings rose nearly 50 percent thanks to cost controls and a lower tax rate, and it raised its earnings forecast for the full year because of a recently completed product acquisition.
For the fiscal second quarter ended Aug. 31, the company said net income rose to $13.1 million, or 42 cents per share, from $8.9 million, or 30 cents per share, a year earlier. Sales rose 4.3 percent to $115.8 million.


Awesome pre-market action already! Congrats to all that got in on this one, and once again, $$$MR. MARKET$$$ is HUGE!!!!

-Dave

[mrmarket]

Originally Posted by Dave

Reuters
Helen of Troy earnings jump nearly 50 pct
Thursday October 2, 7:55 am ET


NEW YORK, Oct 2 (Reuters) - Helen of Troy Ltd. (NasdaqNM:HELE - News), a personal care products company, on Thursday said quarterly earnings rose nearly 50 percent thanks to cost controls and a lower tax rate, and it raised its earnings forecast for the full year because of a recently completed product acquisition.
For the fiscal second quarter ended Aug. 31, the company said net income rose to $13.1 million, or 42 cents per share, from $8.9 million, or 30 cents per share, a year earlier. Sales rose 4.3 percent to $115.8 million.


Awesome pre-market action already! Congrats to all that got in on this one, and once again, $$$MR. MARKET$$$ is HUGE!!!!

-Dave

Everyone repeat after me:

Earnings.....earnings....earnings.

[matzoid]

Woohoo! 17% in 3 days with HELE (after commissions)!

I got in at 22, out this morning at 25.99.

Thanks MM for another great pick.

Unfortunately they missed revenue estimates, and it is not looking too good today. The Tactica brand had year-on-year decrease of 10million in sales, which accounts for the -6.7% in revenues. Looks like they are looking to dump Tactica as well. Increase in earnings seems to have come from lower tax rate and that is not being received well. Apparently, today, revenue>earnings for HELE. Doh!

-Dave

[mrmarket]

Originally Posted by Dave

Unfortunately they missed revenue estimates, and it is not looking too good today. The Tactica brand had year-on-year decrease of 10million in sales, which accounts for the -6.7% in revenues. Looks like they are looking to dump Tactica as well. Increase in earnings seems to have come from lower tax rate and that is not being received well. Apparently, today, revenue>earnings for HELE. Doh!

-Dave

Stenzrob is correct..revenues are extremely important...that doesn't mean this company's fundamentals have changed. Patience grasshopper.

It was very hazy to me during the CC as to if they included Brut earnings in their rest of the year guidance. If so, then they actually guided down, most likely due to Tactica biting the big one. At least it sounds like they are about to get rid of Tactica, and it also appears they will be buying back 2+million shares VERY quickly. Looks like this one may take until next quarter to get to the 28 range.

[stenzrob]

Originally Posted by mrmarket

Stenzrob is correct..revenues are extremely important...that doesn't mean this company's fundamentals have changed. Patience grasshopper.

That's right, the fundamentals haven't changed. The 5 year average revenue growth rate is 12.5%, which has dropped off recently. (Revenue deceleration bad) The 5 year average EPS growth rate is 11%, which jumped up recently due to tax benefits and other adjustments, which means that future comparisons will look bad, not better. The PE is 15.8, which is higher than the growth rate. There is nothing to get excited about here, IMO. If the revenue is not growing, it's all over.

If I had bought this, I would be looking for the exit now, before it drops to $16.50 and you have to wait another year or two to breakeven. But that's just me ...

Looks like HELE will not be the big #50.... it is #49!!!

HELE just blew past $$Mr. Market's$$ targets like a rocket!! Great companies are GREAT COMPANIES, even if they hit a rough spot here and there.

I have taken my 15% and am anxiously awaiting the next winner!

All hail the KING of stock-pickers!! $$Mr. Markets$$ is HUGE!!