SAN FRANCISCO -- When growing corn, don't spread too many seeds in the field.

The Buckle

(BKE) - Get Report

is putting that strategy to work in teenage fashion. The Buckle sells

Tommy Hilfiger

(TOM)

shirts,

Doc Martens

shoes and private-label jeans to buyers ranging in age from 13 to 24.

This year the Kearney, Neb.-based retailer will plant 26 new stores in six states including California and West Virginia, extending its chain to 248 stores in 31 states as of April 8. The Buckle's 12%-a-year pace of store expansion is mild compared with the weedlike proliferation of other teen retailers.

Pacific Sunwear

(PSUN)

aims to increase the number of its stores 32% to 446 this year, and

Wet Seal

(WTSLA)

is shooting for 23% growth this year, including an acquired chain.

The Buckle's stock trades at a discount to its peers, at 14 times trailing earnings, compared with P/Es of 32 for Pacific Sunwear and 23 for Wet Seal. The Buckle's management is respected on Wall Street for keeping a tight belt on operations.

Later this year the company, which started as Mills Clothing in 1948, will open its first California store in Bakersfield, a midsize town north of Los Angeles. Chairman Daniel Hirschfeld, who personally reads every customer comment on the company's new Web site, now receives inquiries about why The Buckle hasn't hit LA. Maybe it will happen next year, the company says.

The Buckle's stock has slipped 26% since January, finishing Friday at 22 5/16, amid concern about a slight ebbing in revenue and profit growth. In the first fiscal quarter ended May 1, The Buckle grew profits 30% to $6.5 million, or 28 cents per share, from $5 million, or 21 cents a share, a year earlier. Revenue edged up 19% to $80 million from $67 million a year. In the first quarter of the previous year, profits had grown 117% and revenues had grown 39%.

On May 6 The Buckle said its sales at stores older than one year slipped 3% in April from the prior year. But it had a tough act to follow -- same-store sales grew 38% in April 1998 -- and one investor still believes he has found a maturing, still-dependable company.

"It's a money machine," says Roger Lipton, president of investment bank

Lipton Financial Services

, which has been tucking shares of The Buckle into its portfolio for eight months. His firm has no underwriting ties with The Buckle. Among Lipton's favorite figures: The Buckle has generated a 21% return on assets and 27% return on equity, better than most rivals except

American Eagle Outfitters

(AEOS)

, which has a 47% return on equity and 31% return on assets.

But The Buckle is far less expensive. It trades at 14 times earnings and 1.3 times revenue for the last four quarters, compared with American Eagle at 34 times earnings and 3 times revenue. The Buckle is "probably my favorite value right now," says Lipton.

A

First Call

survey of equity analysts predicts that The Buckle will show a profit of $1.71 per share in the fiscal year ending January 2000, up from the prior fiscal year's profit of $1.47.

Analyst Kelly Armstrong with

First Union

, who rates the stock a buy, says The Buckle also is penalized for its relatively thin float. While 65,000 shares are exchanged daily, only 8 million of 22 million shares trade publicly, which can make it difficult for institutional investors to amass considerable positions or to exit the stock without depressing the share price. First Union has no banking ties to The Buckle.

That hasn't stopped Lipton, who has made The Buckle one of the largest positions in his portfolio, although he declined to say how much he owns. Lipton is pleased that insiders, who control 66% of stock, have some skin in the game.

The company has been working to keep costs down. In the last three years The Buckle has trimmed distribution costs, occupancy costs and selling expenses, helping it improve margins slightly even while its tax rate increased. In the quarter ended May 1, The Buckle grew net margins to 8% from 7% one year earlier. The Buckle's net margins now match Wet Seal's and beat Pacific Sunwear's.

Despite lower costs, the pace of The Buckle's expansion isn't expected to pick up. Kyle Hanson, Buckle's general counsel and spokeswoman, says the company has no plans to mimic

Starbucks

(SBUX) - Get Report

.

That's just fine with many of those who follow the company. "They're very strong on the bottom line despite only growing stores 10%," says Armstrong. "The performance has been exceptional."