The Finish Line Inc. - Value

Retailers are having a jolly holiday season. The Finish Line, Inc. (FINL) reported fiscal third quarter results on Dec 21 and saw same store sales rise 10.1%. The company has attractive valuations, with a forward P/E of 13.2.

The Finish Line is a specialty retailer of sport footwear, apparel and accessories for men, women and children. It carries brands like Nike, Puma, Adidas and North Face.

Its 669 stores are located in shopping malls in 47 states. The company also has an online ecommerce site at finishline.com.

Sales Rose 8.7% in the Fiscal Third Quarter

On Dec 21, The Finish Line reported its fiscal third quarter results, which ended on Nov 27. Since it reported during the height of the holiday shopping season, it provides a good barometer about what is happening in the retail business.

Earnings per share were 8 cents a share, compared to zero cents a year ago. Net sales rose 8.7% while same store sales jumped 10.1% compared to an increase of just 1.7% in the year ago quarter.

Inventories increased 10.4% to $262.2 million from $237.5 million a year ago.

Year-to-date same store sales rose 7.3% compared to a 4.7% decrease in the difficult retail environment last year.

Looking ahead to December, for the period between Nov 28 and Dec 19, which will be reported in fiscal fourth quarter, same store sales rose 4.5% compared to an increase of 4.9% in the same period last year.

Full Year Estimates Jump

Analysts have been busy raising estimates for both fiscal 2011 and fiscal 2012 given the strong third quarter results.

9 out of 12 estimates rose in the last week for fiscal 2011, pushing the Zacks Consensus up 5 cents to $1.29 per share in that time. That is earnings growth of 51.7%.

Similarly, the fiscal 2012 Zacks Consensus rose 6 cents to $1.41 per share in the last 7 days. This is another 9% earnings growth.

Sill a Value Stock

In addition to an attractive forward P/E, The Finish Line also has a price-to-sales ratio of just 0.7.

Its price-to-book ratio of about 2.0 is under its peers at 2.1 and well within the value range of under 3.0.

The company has a solid 1-year return on equity (ROE) of 14.9%, ahead of its peers who average 12.6%.

The Finish Line is a Zacks #1 Rank (strong buy) stock.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

 
FINISH LINE-CLA (FINL): Free Stock Analysis Report
 
Zacks Investment Research