| Stock (Symbol) | Stock Price | |
GNC Holdings (GNC) |
$41 |
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| Data is as of | Expected to Report | Sector |
February 25, 2013 |
May 5 |
Retail & Travel |
| Sharek’s Take | ||
 I’m so impressed with GNC’s (GNC) management. The board of directors just announced another stock buyback program that should buyback $250 million worth of stock in the next 12 months. GNC has a $4 billion market cap, so that’s around 6.5% of shares. This isn’t the only way management rewards shareholders, the company also pays a dividend of 1.5%. These are excellent uses of cash. GNC also has a P/E of only 15 with an estimated Long Term Growth Rate of 19% — so the stock’s undervalued. This is a solid investment in most every way. |
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| One-Year Chart | ||
 Profit growth was a sizzling 43% last quarter as sales increased only 11% — again, solid management that gets a lot of profit from a little sales increase. Stock’s been rising too — others are seeing the value in these shares. Profit growth is expected to be at least 20% the next two quarters. Stock’s undervalued at 15 times earnings. |
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| Earnings Table | ||
 Profit growth of 43% was partially attributed to solid same store sales growth of 7% (overall sales rose 11%). Hurricane Sandy hurt sales, but GNC still came thorough in a big way (VSI didn’t, and the stock got hit).GNC beaten the street every quarter since its IPO in April 2011. The company has two caalysts pushing EPS higher. 1st, GNC will be launching a record number of high-margin GNC brands in 2013. 2nd, the company has a Gold Card program (like a VIP card) that gives customers 20% off the 1st 7 days of the month. Quarterly estimates show 20% growth continuing. |
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| Fair Value | ||
 I still think GNC is worth 18 times earnings, the stock should continue higher. |
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| Ten-Year Chart | ||
 Last quarter I said “I think this stock will get to $42 very shortly, perhaps by year end (6 weeks)”. Well, it took a little longer but GNC got there within the quarter. Now the stock looks like it will breakout and make another move like it make after its IPO. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
4 of 14 |
GNC has solid management that is doing all the right things. The stock’s selling for only 15 times earnings even though its expected to grow profits 20%. This is one of my favorite investments. GNC is ranked 4th in the 14 stock Growth Portfolio Power Rankings and 3rd in the 8 stock Aggressive Growth Portfolio Power Rankings. |
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Aggressive Growth Portfolio
3 of 8 |
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