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lululemon athletica inc. (LULU)
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Aritzia Inc. Subordinate Voting Shares (ATZ)
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Five Below Inc. (FIVE)
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Crocs Inc. (CROX)
Q: Hi, I sold CROX and ATZ both for a tax loss but both have now come back and seem to have good momentum. Would you be buying either or both of these now? Do you prefer one over the other? They both seem to be moving almost in tandem at this time. Is there another name in the space you like more. Thank you in advance!
5i Research Answer:
We would be very comfortable buying CROX; it is very cheap and we think investors are miss pricing the concern on Hey Dude. Debt is declining and cash generation is very high. On ATZ, while the stock is doing much better we have not seen a fundamental shift yet. We think it. will ultimately be fine but would like to see lower inventories and better growth. We would prefer CROX today. We would see CROX amongst our sector favourite. We do like LULU a lot, but it is significantly larger than both and far more expensive. FIVE is different than these three but also interesting.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in FIVE, CROX.