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Zumiez Inc., the skateboard apparel retailer (Zumiez)
Zumiez Inc., the skateboard apparel retailer (Zumiez)

Research Report

Action sports retailer popular with model portfolios of the investing greats Add to ...

Validea’s pick of the week provides a detailed report on a company that scores well in the stock-screening service’s model portfolios. On Validea.ca, investors can analyze 1,000 Canadian stocks through 12 different guru-based models and get individual reports on each company. Globe Investor has a distribution agreement with Validea.ca. Try it.

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Zumiez Inc. is a specialty retailer of action sports related apparel, footwear, accessories and hard goods, focusing on skateboarding, snowboarding, surfing, motocross and BMX for young men and women. With a market cap of $1-billion (U.S.), the company has 551 stores; 511 in the United States, 28 in Canada and 12 in Europe. It operates under the names Zumiez and Blue Tomato.

Zumiez has a 15-per-cent return on equity. It has a 2.9 current ratio and no long term debt, which the Benjamin Graham-based approach likes.

The company also gets strong interest from the James O'Shaughnessy-based growth model, which likes its solid 73 relative strength and reasonable 1.3 price/sales ratio.

It has grown EPS at a 32-per-cent clip over the long term (using avg of 3,4 and 5 yr EPS growth rates), part of why it gets strong interest from Peter Lynch model. The Lynch model also likes its 0.68 P/E-to-growth ratio.

Zumiez gets some interest from the Ken Fisher-based model, thanks in part to its lack of debt, strong growth, and 6.5-per-cent three-year average net profit margins.

John Reese is long ZUMZ

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