Chico's FAS Inc. (CHS)

[Porgie Tirebiter]

There were some buy-out rumors around in late Novemeber.

Then some other analysts were saying that CHS doesn't work as a buy-out target because it trades at a higher multiple (ie; it's more expensive) than it's peers, which is true.

But then again, CHS has averaged a 10% revenue growth rate over the last 5 years, during a tough time to grow revenue. They had a couple tough quarters over the last two years, but who didn't? They are bouncing back... Fast. In the last 12 months they grew earnings at 27% on revenue growth of 13%.

I think this stock is real cheap based on the company's growth rate. It keeps getting hammered when there is bad news about unemployment or retail sales in general, but the high-end market they serve is less sensitive to those kind of numbers.

I think CHS is a growth stock that pays a dividend, and is an ideal take-over target for one of the industry powerhouses, or a take-out for private equity. Either way, I think shareholders would collect a pretty nice premium. Meanwhile I'll pocket the dividend.