Friday, June 12, 2009

Jo-Ann Says

A very interesting paragraph appears in the most recent 10Q filing of Jo-Ann Stores (JAS):

Regarding our competition, Wal-Mart is continuing its remodel program, which includes removing the fabric department from many stores. We expect to capture new customers and gain market shares as a result of these changes.

I think this retailer is perfect for the current economic environment. And they have scale in the fabric/craft space that others don't. Solidifying their leadership in a niche retail space.

Market capitalization is $550 million with $85 million cash and $50.5 million debt. Positive free cash flow of $19 million in the most recent quarter. This turnaround is real. First Pacific (Bob Rodriquez) likes it. And so do I.

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