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Should We Buy Tile Shop Hldgs, Inc. (TTS) in 2013?

Tile Shop has a high insider ownership. Robert Rucker, the President and CEO, owns a 19.82% stake in the company. Peter Jacullo, Director, had a 12.86% stake in Tile Shop. All executive officers and directors combined hold more than 37% stake in the company. At the current trading price of $17.95 per share, the total market cap is $765.62 million. Tile Shop is quite richly valued, at 17.7x EV/EBITDA. Both Home Depot and Lowe’s are valued a lot cheaper, at 11.8x and 9.75x EV/EBITDA, respectively.

My Foolish Take

With a high insider ownership, a high EBITDA margin, and high comparable store sales growth, Tile Shop seems to be a good stock for investors in the long run. However, because of the expensive valuation, I would rather wait for a price correction before initiating a long position in this company.

The article Should We Buy This Specialty Retailer in 2013? originally appeared on and is written by Anh HOANG.

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