New Lifetime High Reached: Men's Wearhouse (MW)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Men's Wearhouse ( MW) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified Men's Wearhouse as such a stock due to the following factors:

  • MW has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $20.4 million.
  • MW has traded 36,175 shares today.
  • MW is trading at a new lifetime high.

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More details on MW:

The Men's Wearhouse, Inc. operates as a specialty apparel retailer in the United States, Puerto Rico, and Canada. The company operates in two segments, Retail and Corporate Apparel. The stock currently has a dividend yield of 1.2%. Currently there are 4 analysts that rate Men's Wearhouse a buy, no analysts rate it a sell, and none rate it a hold.

The average volume for Men's Wearhouse has been 706,700 shares per day over the past 30 days. Men's Wearhouse has a market cap of $2.8 billion and is part of the services sector and retail industry. The stock has a beta of 1.32 and a short float of 11.5% with 18.31 days to cover. Shares are up 32.1% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Men's Wearhouse as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, expanding profit margins, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • MW's very impressive revenue growth greatly exceeded the industry average of 10.4%. Since the same quarter one year prior, revenues leaped by 65.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • 42.60% is the gross profit margin for MENS WEARHOUSE INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -3.86% is in-line with the industry average.
  • Net operating cash flow has increased to $35.75 million or 20.98% when compared to the same quarter last year. Despite an increase in cash flow, MENS WEARHOUSE INC's cash flow growth rate is still lower than the industry average growth rate of 31.25%.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
  • MENS WEARHOUSE INC's earnings per share declined by 17.2% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, MENS WEARHOUSE INC swung to a loss, reporting -$0.02 versus $1.65 in the prior year. This year, the market expects an improvement in earnings ($2.87 versus -$0.02).

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