Yeah, we all need someone we can bleed on
Yeah, and if you want it, baby, well you can bleed on me.

-- Rolling Stones

With apologies to Mick and the ( cough, cough) boys, the above lyrics sum up my attitude towards readers' feedback. I've got thick skin and expected a barrage of negative comments regarding my articles over the past month -- especially since most of them took bearish stances on individual stocks.

I'm sure that day will come. But so far, most of the emails have been very positive. Even the ones that weren't especially supportive were still thoughtful and contained insightful questions.

I am treating the picks in the column like a portfolio -- continuously monitoring the stocks I recommend or pan, and providing you with periodic updates. The performance figures are based on the closing price of the stock on the day my column ran.

Lamar Advertising

Lamar Advertising ( LAMR) is up a hair since my bearish column on Jan. 5. Admittedly, this is a stock that I have been frustrated by since I issued a sell rating last summer when I was with Avalon Research. The stock just refuses to roll over.

Lamar releases its fourth-quarter and full-year results on Feb. 21 before the open. The street is expecting earnings per share of 6 cents on sales of $250.5 million for the quarter. Looking ahead to next year, the outdoor advertising company is projected to earn 60 cents a share on revenue of $1.08 billion.

I will be especially interested in seeing what Lamar's occupancy rates are as the company has touted the potential to "blow through the norms" for several quarters. So far, there's been no blowing, more like creeping -- up to the norms, not through them.

Here's a sample of the feedback I've received on Lamar:

There is considerable debt. All the growth comes from acquisitions, which history tells us eventually is a losing proposition for stock appreciation. But, the mutual funds and analysts love this thing. They never have a bad word to say, even when they disappoint year after year. I usually buy small put options around earnings time and collect when the stock disappoints, but the price always seems to bounce back. How long can they keep it afloat -- probably until the next recession, when it will be a fabulous short. Good work.
-- W.F. from Louisiana

W.F. is correct that the street loves the stock and is probably the reason why it always bounces back. I still believe Lamar's problems are significant enough that the stock should head south even before the next recession.

Several readers took issue with how I valued the company, pointing out that free cash flow may be more appropriate:

I follow this stock pretty closely and I think your statements on valuation, while correct, are misleading. Specifically, you need to look into the capital expenditures requirements for LAMR vs. Clear Channel Outdoor (CCO) and focus on free cash flow yield in order to understand the valuation. On a free cash flow basis, you will find that the multiple is about 19 times free cash flow, which represents a slight discount to CCO.
-- Len May from Wayland, Mass.

If you take a snapshot of Lamar right now, free cash flow is solid and debt, while high, isn't unmanageable. My concern is that the company has a history of poor execution. Should Lamar hit a bump in the road, either due to lower occupancy rates or fewer acquisitions, some of the numbers begin to look tenuous. I also question the value of a company that fails to grow organically and needs acquisitions to fuel growth. Lastly, I believe Clear Channel Outdoor's focus on major metropolitan areas is better positioned than Lamar's smaller city concentration.

BJ's Wholesale Club

On Jan. 10, I wrote a bearish piece about BJ's Wholesale Club ( BJ) and why I don't think a private equity takeover makes sense. As of Thursday's close, the stock is up about 2.6% since that column.

Last week, BJ's reported abysmal same-store sales numbers for January. The company posted a 2% comp with a 2.1% contribution from gasoline. In other words, if the price of gas had stayed constant, BJ's would have seen a decline of 0.1% in same-store sales. That compares with Costco's ( COST) 9% comp, or 7.4% excluding gas and the effect of currency fluctuations.

BJ's reports fourth-quarter and full-year fiscal 2006 (ending Jan. 31) earnings on Feb. 28 before the open. The consensus EPS estimate is 74 cents on sales of $2.18 billion. The consensus forecast for fiscal 2007 is earnings of $2.04 (options expense excluded -- and down a penny since my column) on sales of $2.44 billion. I still believe the company will earn less than $2 per share.

What did you have to say? Not one emailer disagreed with my position.

A reader from New York whose name I won't use for obvious reasons said:

I think you are right on regarding BJ's. I have worked in BJ's for 16 years. Its busy gas station brings in people. Wall to wall stuff packed to the doors. No sense of openness of a Costco. Staff is cut back to barebones. No one has a set job. Oops -- have company will get back to you later.

With any hope, BJ's email police aren't tracking this reader's outbound messages. While his store sounds busy, his comparison to Costco is right on the money. Shoppers enjoy going to Costco. People have to go to BJ's. There's a big difference in how much and what kind of stuff those two types of customers will buy.

In upcoming columns, I'll publish updates and reader feedback on American Pharmaceutical Partners ( APPX), P.F. Chang's ( PFCB), Webster Financial ( WBS) and Encore Medical ( ENMC).

As always, I welcome your feedback. And if you want to, you can bleed on me.
In keeping with TSC's editorial policy, Lichtenfeld doesn't own or short individual stocks. He also doesn't invest in hedge funds or other private investment partnerships.

Marc Lichtenfeld was previously an analyst at Avalon Research Group and The Weiss Group and a trader at Carlin Equities. He holds NASD 86,87, 7 and 63 licenses. His prior journalism experience includes being a reporter/anchor for On24 in San Francisco and a managing editor of InvestorsObserver, a personal finance Web site. He is a graduate of the State University of New York at Albany. He appreciates your feedback; click here to send him an email.