True Religion Apparel Inc (TRLG)

[DrKellegro]

Dr. Kellegro initiates coverage of TRLG with a F/70- rating.

The following factors influenced the rating and decision to sell short TRLG shares:

1. A specialty retail stock that did what specialty retail stocks do during their life cycle: go from obscurity to becoming a recognizable brand. The life cycle becomes complete when the fickle public moves onto the next specialty retail name. TRLG is in the latter stage of this life cycle as consumers are beginning to move away from the brand.

2. An inept management team that is A) trying to keep the stock price inflated with pie in the sky dreams of success through expansion B) dense enough to actually believe that their plan of expansion will lead to increased revenue and brand recognition independent of consumer spending habits C) unfocused and moving away from the business that got them to this point in the first place.

3. Insider selling that is not substantial but monumental, with the leader of the pack being the founder of the company himself.

TRLG, with its current market value, is a deception and an outright lie. It should not only be avoided by prospective investors, but taken advantage of by those astute enough to recognize the vast number of flaws apparent within the company.

Further details are available here http://drkellegro.com/?p=68