Duluth Holdings (DLTH)

[inversor86]

I don't think so. I always thought Sears was the location that introduced it but it was more influenced by Dean Witter/Morgan Stanley.

[bar1080]

Discover was created by Sears about 30 years ago. Could that connection be a problem with Sears having so many problems now? Wealthy people never carried Discover cards.

[inversor86]

Personally, I've always thought PayPal had a terrible platform with customer service to match. 1 Amex, a PenFed Visa, and a Fidelity Visa in my pocket. Younger people don't use PayPal unless forced to. We like Venmo, which PayPal was smart enough to partner with early on. Free. No Fees.

[bar1080]

Lately my mail's been showered with credit card offers so that it's starting to look like 2007 again when I'd get something from Capital One everyday (by the Great Recession those totally stopped). Yes, I'd get a few for Discover.

I'm actually a terrible prospect for credit cards. I've used the same USAA personal card for maybe 30 years. I also carry a different card for business expenses. I've had that one for 20 years. That's all I have or need.

Also noticing more infomercials for house flipping seminars. Those peaked in 1999 and 2007... signs of economic overheating.

My own company takes credit cards so I can see which card is most popular (Visa) and which is least (Discover). MasterCard has been declining for years. Quite a few use Paypal. PYPL has strongly beaten DFS

[inversor86]

Is it a cop out if I copy paste some seeking alpha article on DFS? I bought it because their numbers looked good, it seemed like DFS was on the far side of a trading range down while Visa, Master Card, and AMEX are all at highs. I know internally from an employee that Discover is fiercely competitive and always nipping at the heels of the #1 company, American Express, interms of customer service quality and satisfaction.


Copy paste;

Most Attractive Stocks Feature for September: Discover Financial Systems (NYSE:DFS)

Discover Financial Services, a payment service and credit card provider, is one of the additions to our Most Attractive stocks for September. DFS was also a featured Long Idea in December 2014 and highlighted as an underappreciated stock in July 2016.


"Since 2011, DFS has grown revenue by 5% compounded annually. Over the same time, the company has grown after-tax profit (NOPAT) by 57% compounded annually, per Figure 1. The impressive NOPAT growth can be credited to margin improvement from 3% in 2010 to 29% over the last twelve months. DFS also earns a top-quintile 19% return on invested capital (ROIC).

Figure 1: Discover’s NOPAT Growth Since 2010


Sources: New Constructs, LLC and company filings

DFS Presents an Attractive Risk/Reward Trade-Off

DFS is down 19% year-to-date while the S&P 500 is up 11%. This price depreciation amidst solid fundamentals provides an attractive buying opportunity. At its current price of $58/share, DFS has a price-to-economic book value (PEBV) ratio of 0.6. This ratio means the market expects DFS’ NOPAT to permanently decline 40% from current levels. This expectation seems rather pessimistic for a firm that has consistently grown NOPAT over the past decade.

If DFS were to never grow after-tax profits from current levels, the economic book value, or no growth value of the firm, is $101/share – a 74% upside. If DFS maintains TTM NOPAT margins (29%) and can grow NOPAT by 4% for the next decade, the stock is worth $125/share today – a 115% upside."

[bar1080]

No, all I know is Discover has always been a bit player in the credit card business, and still is. What's the bull argument for it?

[inversor86]

Would you ever consider holding DFS?

[bar1080]

I find DLTH interesting but it's not the sort of stock I buy. Boeing has become one of the star stocks of 2017. Out of no where, my Rockwell Collins soared in afterhours trading Friday, up about $10 a share. (I've owned Rockwell Automation (ROK) and Rockwell Collins (COL) for years). United Technologies (UTX) is looking at acquiring COL.

My large COL holding is why I never added more Boeing, both being in the aircraft sector. Collins is mostly in aviation electronics. It's a pedigreed blue chip and very much a "Buffett type" stock, although I'm pretty sure he's never owned it. Otherwise my stocks have stalled with several drifting slightly lower.

[inversor86]

I bought DSW back on Monday at $16.64. Deutsche Bank upgraded them overnight and I sold it again today.

[inversor86]

The closest thing to a truck I have is a classic Land Rover Series III "truck". I've always been a car person, mostly fast cars with an old Honda Accord for daily and winter driving.

I buy eclectic vehicles that are appreciating in value, need work that I do or can have done cheaply, or are just seriously mispriced by the owner. Everything I own could fit in a studio apartment, but I have 7 vehicles scattered around different places. In general, I am a minimalist.

[bar1080]

That's what the guy next door just finished, 4-car garage with his office in a loft above. You have trucks? That's one of the big reasons for the trend to bigger garages. The main reason tho is that American's just own a ton of stuff. We have a small garage and often can only get one car to fit, among the other things stashed in there.

Do own a storage locker?

[inversor86]

I would gladly just have a giant garage with a loft over it.

[bar1080]

My stocks are inching up. In fact every one of my holdings was green today, a very rare event. I have a small bit of Boeing, a spinoff from years ago. Heard that Boeing is the #1 Dow 30 stock so far this year. Kinda kicking myself for not adding...thought about doing that many times over the years.

Yea, garages are getting huge. The house next-door just remodeled and went from a 2-car garage to a 4-car. That's almost standard for a nice home these days.

[inversor86]

DWS tripped my re-entry price (same price I entered at before, $16.78). I passed on the buying opportunity and reset a lower entry alert. I've been house shopping though so I'm trying to sit with a large cash position incase I want to avoid PMI. As of right now my plan is to buy a "big" house since they are the market that hasn't rebounded, then get roommates and let them pay for it. I also need more garage and parking space. My car collection is getting out of control.

[bar1080]

I tend to agree with experts who say the most common investing mistake is selling winners quickly and holding losers, or worse, averaging down. Still, I can't get excited about a shoe store chain or ANYTHING in retailing these days. I will check out the mens shoes at DSW.

Come to think about it, I did own a shoe company 35 years ago. Looking back, it probably wasn't the smartest investment I ever made but some corporate raider bought the company, overpaid, and I made a damn good profit on it.

Doubt that raider did well.

[inversor86]

Today I sold my DSW position. It was up 9% and I was able to receive their dividend, which added another 1.x% gain. I set a low price alert, perhaps I will repurchase.

[inversor86]

I thought it was funny that they offered everyone at the company healthy severance to shed any non-fully committed workers. Many left. It must be hard to find people who dream of selling shoes. I know of only one person:

[bar1080]

I'm quite familiar with online shoe seliing and buying. Your assessment of the profit problem is accurate. Shoes are heavy --costly to ship-- and they have to fit right. Zappos became the top dog by going for volume over everything else. Like Amazon did. And like Amazon, Zappos always lost money. They had tons of VC funding. Last I heard about Zappos, they were finally starting to make a few bucks.

But there are zillions of niche shoe sellers, including DLTH in work boots and safety footwear. I don't think it matters to most shoppers whether Zappos has that broad offering of mens, womens, childrens, infants, athletics etc. etc. Shoppers just want to find what they want, and cheaply.

I tend to buy the same shoe styles over and over. Bought some online from 6PM.

"I don't hear about people buying shoes from Zappos anymore but I used to" Yep, I also got tired of hearing about their relaxed corporate "culture."

[inversor86]

They did.

There are no equivalent brick and mortar competitors to DSW. No retailer seems to have 1/3rd of their in-store availability. Online is another story. Amazon bought Zappos in 2009. Zappos was the only real successful online-only shoe retailer. I don't hear about people buying shoes from Zappos anymore but I used too. Several issues, shoe sizing is all over the map, the doctored stock photos vs in person are usually not equivalent, and then the final and most important factor... are they comfortable? Everyone I know has been burned by an online shoe buy. These companies always have to eat the shipping on the return and eat it they do.

Zappos and DSW are not redundant though, they seem to have different focuses on what they carry.

[bar1080]

But what if Amazon buys another shoe seller? Then DSW tanks badly.

[bar1080]

Yep. Reached $15 almost immediately.

Nov 20, 2015.

"Shares of workwear retailer Duluth Holdings Inc. closed higher on its first day of trading Friday, after the parent of retailer Duluth Trading Co. priced its initial public offering at $12 a share, lower than it had initially targeted.

Shares of Duluth Holdings Inc. closed at $13.65, up nearly 14%, in its first day of trading with the ticker symbol DLTH.

The company said in a filing with securities regulators Friday that its offering raised $74.4 million for the company as well as $5.6 million for investment banks working as its underwriters.

Earlier this month, Duluth told regulators it expected the offering to be priced between $14 and $16 a share. Of the funds raised, some $51.1 million would go to existing shareholders, including executive chairman Stephen Schlecht. The remainder will be used by the company as it embarks on an ambitious retail store expansion plan.

Based south of Madison in Belleville, Duluth is primarily a direct merchant, selling through its catalogs and online. However, the retailer began opening brick-and-mortar stores five years ago — it now has 10 open or leased for future openings — and envisions as many as 100 across the country.

In Wisconsin, Duluth has stores in Mount Horeb, Port Washington, Oshkosh and Belleville."

[inversor86]

IPO price was $12.

[inversor86]

I think DSW could be an Amazon acquisition.

[bar1080]

I'll definitely check it out. There are two big DSW's near me but I've never shopped in one.

Looks like my sizable position in Walgreen's is becoming a problem. The Amazon announcement about acquiring Whole Food is probably driving it down... along with hundreds of other stocks. Amazing.

And DLTH is nearly back to its IPO price, which was 15 I believe.

[inversor86]

DSW is the best men's shoe place I have been in. I like their online/store setup too. Order online and pick up at a store for free, if you don't like the item it goes into their stock or if the store doesn't carry that specific item then it goes into a special section and is sold at a discount. For the retailers that do well all this mall/retail trouble could be helpful. It has to make space easier and cheaper to find.

DSW pays a healthy dividend, about 4.7% at the current trading price.

[bar1080]

I subscribed to the WSJ for decades but just started getting it again. I don't do much more than skim it most days. Get most of my business news from other sources online.

Is DSW a good place to buy mens shoes?

I wouldn't term what's happening to retailing as just a correction. Many of the stocks have a floor of zero. In the past year stocks of mall owners have been in trouble. The severe problems are spreading.

[inversor86]

I went and read the article, also a WSJ subscriber. The only news service that I pay for. My second position in URBN is down now but I am not concerned. I took a position in DSW at $16.76. One of few places I shop. Retail seems to be the sector correction for 2017.

[bar1080]

WSJ: "Retailers Debt is Bigger Than It Looks"

Article mentions that accounting rules going into effect in late 2018 will make retailers include leasehold obligations on financials. URBN is mentioned as a firm that may suffer from the change. JCP will especially suffer.

Article is only available ot WSJ subscribers (like me)

[bar1080]

Hard to beat index funds. My stocks--all doing pretty well--are just keeping pace with the S&P over the past several months. Large caps are somewhat out of fashion now.

As for your other stock, it really does remind me of WAVX, when it was trading. It may have had real business prospects when it was on the NASDAQ in the 90s, then insiders realized the tech was hopeless. But they forgot to tell the shareholders. Some just kept averaging down. That company really had nothing except hype the last ten years.

Will be quite busy the next few weeks. Not much time to follow stocks.

[inversor86]

I have $47000 purchasing power in a Roth that needs to be reallocated. I feel like I should put it into something managed by Blackstone or Vanguard. Let professionals handle it for a change. I've beaten the odds too many times. This is your realm more than mine if you have any input. The Roth account was funded by a $19000 IRA position rollover in late 2013. Now the account is worth around $90000. I have other Roths, but they're small. I've never contributed to this one aside from the initial.

[bar1080]

Where I live they don't have any stores. Saw one in Florida a few years ago. Know almost nothing about the company. But might be worth a look.

BTW, heard another Duluth ad on TV a few days ago.

[inversor86]

TSCO worth a look?

What is moving for me? A large position in LWL G. I just returned from a trip to Boulder to attend their shareholder meeting and after hours activities. I know the company and new CEO well. The message board is being attacked right now and Ihub is removing old mods for unknown reasons, deleting posts left and right and leaving trash by a paid shill. I would swear Ihub still have remnants of it's criminal creators involved. It was a very healthy and friendly message board until Friday. Would enjoy your take on that off the board. I'm already close to being put on restriction as it is.

[inversor86]

They were called Janus Resources -symbol JANI- until 2013. An "oil and gas" company. Prior to that, they were Entheos Technologies, Inc. symbol ETHT. And prior to that several others, all owned/run by this guy who is a 60%+ owner of Renovacare... https://www.investorvillage.com/mbthread.asp?mb=6741&tid=3301750&showall=1


Kalen Capital Corporation (“KCC”), a private corporation solely owned by Mr. Harmel Rayat, beneficially owns approximately 66% of our issued and outstanding stock. This ownership interest may permit KCC to influence significant corporate decisions.

As of March 16, 2017, KCC, a private corporation solely owned by Harmel S. Rayat, a former officer and director of ours, beneficially owned approximately 50,008,783 shares (including shares issuable upon exercise of outstanding warrants and convertible notes), or approximately 66%, of our outstanding common stock. As a result, Mr. Rayat may be able to exercise significant influence over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, and will have significant control over our management and policies. Mr. Rayat’s interests may be different from yours. For example, he may support proposals and actions with which you may disagree or which are not in your interest. This concentration of ownership could delay or prevent a change in control of our company or otherwise discourage a potential acquirer from attempting to obtain control of our company, which in turn could reduce the price of our common stock. In addition, Mr. Rayat could use his voting influence to maintain our existing management and directors in office, or support or reject other management and board proposals that are subject to stockholder approval, such as the adoption of employee stock plans and significant unregistered financing transactions.

Harmel Rayat and SEC fine for stock promotion. Numerous failed shell companies:

https://seekingalpha.com/article/46455-stay-away-from-octillion

Also read this article near the bottom about Rayat:

Entheos Tech, Internat'l Energy, PhytoMedical, and Octillion Corp.-- No Bargains in This Penny Stock Bin

http://10qdetective.blogspot.com/2007_09_01_archive.html

[bar1080]

I'd wondered if RCAR was connected with Rennova Healthcare out of Florida. RNVA. Awful stock.

[inversor86]

I've got a scam stock for you. Check out RCAR.

[bar1080]

What's soaring for you? SWKS is helping me but just about everything else isn't rising (or falling) much.

"getting a feeling like I should sell everything that is up and walk away for a few months."

That feeling-- and it's almost universal-- is what stops most investors from doing really well in the market. Better to dump losers, take the tax loss, and ride winners. Put another way, "the investor's worst enemy is himself."

[inversor86]

URBN has caught the retail bug. Looking appealing at a 52 week low.

My brokerage account is up $100000 in the past month. Getting a feeling like I should sell everything that is up and walk away for a few months.

[bar1080]

I'll drop into a Dollar Tree today or tomorrow. I'd like to see a Ross, too. BTW. Macy's just had a big miss sending a lot of retailing tumbling.

[inversor86]

I have not been inside a Dollar Tree or a Ross. Ulta is one of my investment regrets. Something I knew was great years ago but never had the lightbulb go off to view it as an investment. Same with Flowers Foods to a lesser extent. I picked up 1k of URBN for 23.0761 yesterday, just sold them for 23.765. Applebees on me tonight... lol Another place you wouldn't see me in.

My girlfriend of 7+ years (now ex-girlfriend) was a buyer there before she had a bridge burning meltdown one day. Every morning the company would send out a report to employees reflecting all sales numbers the day before vs the same day a year ago. Always surprised me how much info they gave out. I will say this, they get some of the most creative/brilliant/talented people on earth to work like slaves for 42k a year. Not many companies can pull that off. In the fashion world if you do well at URBN you can go almost anywhere. You can leave URBN and work for Gucci. URBN corporate staff are like the Merchant Marines of the retail world.

[bar1080]

It's not just that most retailers are in dire shape, but malls continue to decline. Who would have predicted today's few retail winners such as Ulta, Dollar Tree, and Ross? I've been darn accurate in taking a pass on the whole sector. There will be winners but I doubt they can be predicted.

BTW, did you notice that Buffett just said that BRK might start paying dividends? The stock dropped perhaps because investors took that as a sign that BRK was running out of growth opportunities. I'd buy into BRK if it paid a div. One of my long-held rules is to only buy dividend-payers.

[inversor86]

I would consider URBN right now if I were going to buy a retail stock. Meanwhile, I'm watching the slow and deserving death of many retailers I was (unfortunately) dressed in as a kid.

[Dam_River_Man]

Sorry, I "meant" insiders.

[Dam_River_Man]

I said Insider's, not IPO buyers. Insider's have to disclose ownership. You can look it up.

[bar1080]

The lockup period ended last May. How could you know how many shares IPO buyers have left?

"investors need to remember that those shares have been locked up since the IPO and it is reasonable for them to want to sell some. Everyone who sold still has a lot of shares left so no worries. "

[Dam_River_Man]

Seems to be pulling back a little because of the insider sells. But investors need to remember that those shares have been locked up since the IPO and it is reasonable for them to want to sell some. Everyone who sold still has a lot of shares left so no worries.

[Dam_River_Man]

I just bought this for my Roth IRA. Never really considered this stock but I should have. I've been wearing their shirts for about 4 years now. The Henley's, and Polo type shirts with the long tail are my favorites. They are about all I wear. I also use their Velcro belts. (I'll never have another kind of belt!) Very nice, high quality clothing!

I'm in for the long haul. I think this can see $40 in 12 to 16 months.

In at $21.70, sell target $40 in however many months it takes to get there.
If it drops below $20 in the near term I will double down.

[inversor86]

If sears shoppers save up for a long time they can buy one item at Duluth. DLTH up big today.

[bar1080]

Also popped on Sears just now voicing "substantial doubt" about its survival. DLTH is a way to play a failing Sears.

http://finance.yahoo.com/news/sears-raises-doubts-ability-continue-221203587.html

[Chill1]

BOOM! BOOM!
Earnings report was Great! Great management! If your not in, its not too late. This thing is headed due NORTH!
Buy for the long term. Opening 12 new stores in '17 with a smart plan. $50 by end of year!!!

[bar1080]

"20/20: Potential Hazards of Warehouse Stores"

"But critics say shopping at stores like Home Depot and Wal-Mart can be dangerous. Heavy merchandise is often stacked high into the air and at Home Depot, forklifts operating during store hours can be hazardous to shoppers.

The safety issue came into sharp focus last year, after three people died at Home Depot stores in an eight-month period."

"Court documents from a suit filed against Wal-Mart reveal that the store had more than 17,000 falling-merchandise incidents between 1989 and 1994. Records from a lawsuit against Home Depot show that a few years ago that store received 185 injury claims per week, though most, they say, were minor."

http://abcnews.go.com/2020/story?id=124120&page=1