IB Net Payout Yields Model

PhillyBurbs.com likes LIZ

Interesting article I pulled using InfoNgen. Not that I've ever heard of PhillyBurbs.com or that I have any knowledge of the fashion value of this source. What is interesting is that the writer has clear fashion knowledge and they have gone from thinking that Liz Claiborne (LIZ) is a 'granny' concept to hip enough for the writer to wear.

My take is that Issac Mizrahi is making the brand hip. This is his 3rd season working with LIZ and should be close to when his impact really begins to be felt. Assuming he can lead a revival with the brand at the same time that the economy recovers combined with essentially wrapping up a restructuring of the company this could be an explosive period for the stock. Jones Apparel (JNY) which is a main competitor has already soared from $4 to $15 after reporting impressive results sooner then expected. LIZ hasn't seen such a turnaround especially on the bottom line, but that could change in a hurry if Mizrahi works his magic if only by changing perceptions.

My fear in buying LIZ last week was that the apparel options weren't as compelling to consumers any more hence lagging way behind JNY. That apparently is changing and the stock has started to perk up of late. LIZ is definitely a buy at these levels for those looking for a big risk/reward play. And by somebody willing to do the research to confirm other opinions on the brand to see whether they agree.

Disclosure: Long LIZ in client and personal accounts.


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