Several insiders have been purchasing shares of recent IPO Tilly’s Inc (NYSE:TLYS), a specialty apparel retailer whose product line is aimed at teens and young adults. While the market capitalization is only about $420 million, an average of 160,000 shares are traded per day and the current market price is over $15 (making for over $2 million in daily dollar volume). As with many other apparel retailers, the valuation at Tilly’s is dependent on future growth: the stock trades at 29 times trailing earnings but only 16 times forward earnings estimates. However, earnings have been not good recently.
$1.3 billion market cap women’s apparel and accessories retailer Francesca’s Holdings Corp (NASDAQ:FRAN) had a number of company officers and Board members buying the stock in mid December. It’s another growth prospect like Tilly’s- the stock carries trailing and forward P/E multiples of 32 and 23, respectively- and another company with a strong bearish community with 39% of the float held short. However, the company has been performing well: it its most recent fiscal quarter, net income was more than double its levels from a year earlier and revenue was 44% higher. Read our analysis of Francesca's.
Pilgrim’s Pride Corporation (NYSE:PPC), a producer and distributor of chicken products, has had an insider and major shareholder JBS USA both buy the stock recently. Pilgrim’s is up 60% in the last year, and its current market capitalization of $2.2 billion places it at 30 times trailing earnings. Wall Street analysts expect strong earnings growth this year, and so this value is only 10 times consensus for 2013. That is an appealing earnings multiple, but since so much of the apparent value is due to expected growth this year we would have to investigate why the sell-side is so bullish before deciding whether or not Pilgrim’s is actually a value stock.
Disclosure: I own no shares of any stocks mentioned in this article.