Vitamin Shoppe (VSI) needs to keep upping estimates for the stock to keep rising. I think it will, but I’m not buying the stock yet.
One Year Chart
VSI’s been on a nice run this year — and it broke out after reporting last quarter’s earnings.
There’s two things I don’t like in this picture. The first is the P/E is 26 which is a little-high for what I think the stock is worth. The second is Estimates show profit growth is set to slow to 10% two quarters from now. VSI has beaten the street by 4 cents to 7 cents a share in each of the last four quarters. I think the company will continue to beat, I just want to see better growth ahead if I’m going to over pay for VSI.
Fair Value
VSI hit $54 today, up $3 on the day. The stock is worth $49 in my eyes. Next year’s Fair Value is $58 and the stock’s only $4 away from that now. VSI needs to keep upping estimates for the stock to keep rising.
Sharek’s Take
I think VSI stock will continue higher, it just doesn’t feel like a hyper growth story. Look at the Earnings Table and you’ll see some red — quarterly estimates don’t look great. This is a stock to buy on a dip, its not compelling here.
View the Ten-Year Chart here.View the Earnings Table here.
