Chico’s has a 13.37 forward P/E and a 1.10% yield with a 0.95 PEG. When they last reported in February the company boasted an increase of net income of 25.6%, and 26.7% in diluted EPS for Q4 2012 compared to Q4 2011. Net sales came in at $651.9 million.
One of their most promising strategies is omni-channel sales with catalogs, websites, mobile apps, call center, and in-store. The company has opened 125 new stores in the last year, with another 125 to 135 for 2013. The Boston Proper website will be expanded to several bricks and mortar stores sometime in 2013. The company is moving into Canada and exploring other international possibilities.
The company has been buying back its stock under a $300 million share repurchase program, with $107 million bought back in FY 2012. The company has no debt, and at the same time returned $142 million to shareholders in 2012.
One thing that is outstanding about Chico’s FAS, Inc. (NYSE:CHS) is its attention to fit and service, with expert bra fittings at Soma stores and what they call their MAPS (Most Amazing Personal Service). Although not specifically targeting the plus-sized, they feature curvier models on their Soma website than Victoria’s Secret.
Best known for full-figured fashion is Ascena Retail Group Inc (NASDAQ:ASNA), owner of Lane Bryant, Maurices, Justice, dressbarn, and Catherines brand stores. The company has 3,800 stores in the US, Puerto Rico, and Canada. Catherines and Lane Bryant are its full figure focus stores, with over 1,200 stores between them. Justice is its tween targeted brands.
Rival Hot Topic, Inc. (NASDAQ:HOTT) is being bought at a premium by private equity. It competed directly on plus size fashion with Torrid and tweens with Hot Topic, Inc. (NASDAQ:HOTT), so there is investor demand for these specialty retail niches.
Ascena Retail Group Inc (NASDAQ:ASNA) has an attractive 12.26 forward P/E and a 1.06 PEG. Analysts expect a fat five year growth rate of 15%. The company reports full-figured annualized revenues of $4.5 billion. However, Q2 results in March disappointed with weak holiday sales and acquisition costs for Lane Bryant and Catherines. When the company reports again in June its numbers will likely be better as it’s ramping up e-commerce (sales up 126% online yoy).
Whipped cream and cherry on top
The recent purchase of Hot Topic will send some investors to Ascena as the logical alternative. Despite no yield it’s the most fairly valued of these companies. For those investors sick of their Abercrombie & Fitch Co. (NYSE:ANF) stock buy Ascena, Nordstrom, or Chico’s instead. There’s a lot to be said for attractive and fat.
The article The Anti-Abercrombies: Attractive & Fat originally appeared on Fool.com is written by AnnaLisa Kraft.
AnnaLisa Kraft has no position in any stocks mentioned. The Motley Fool recommends Ascena Retail Group. AnnaLisa is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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