The Timberland Company - Aggressive Growth

The Timberland Company (TBL) reported solid growth in its latest quarterly report, which was also its fourth consecutive earnings surprise.

Company Description

Timberland makes footwear, apparel and accessories geared toward outdoor activities. Locations can be found around the world including Africa and the Middle East.

Fourth Consecutive Surprise

On Jul 28 Timberland reported a net loss of 19 cents per share, much narrower than the 35 cent loss analysts expected. Losses are not unusual the very seasonal industry. This was the fourth consecutive earnings surprise for the company.

Revenue improved 5% to $189 million with solid growth in North America, Asia and Europe. Management said they remain optimistic moving forward, despite macroeconomic and cost pressures.

Estimates Bounce Back

The full-year Zacks Consensus Estimate for 2010 is up 7 cents, to $1.33 for an expected growth rate of 33%. Next year's forecasts are up 6 cents, to $1.45 for a 9% growth.

Solid Valuations

Share of TBL are going for a decent 13 times forward estimates. However, when you factor in the growth rates, the PEG ration is coming in at 0.9.

The Chart

Timberland's stock was in a short-term downward trend until shares turned around the last week or so. Momentum has shifted and the MACD has signaled a buy.

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service
 
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