Kenneth Cole (KCP): Bloodbath in the making

Discussion in 'Stocks' started by einai, May 6, 2008.

  1. einai


    KCP just reported. A disastrous forecast. The analysts on the call didn't seem to believe them when they said they'll pull out of this in the second half.

    Ask AH is 17.50 - 5% off the close.

    "The Company noted that the soft wholesale business trend will likely result in lower shipments and reduced margins in the second quarter. To reflect this, the Company expects second quarter net revenues in the range of $108 million to $113 million and a loss per share of between $(0.11) and $(0.13)."
  2. einai


    Down 15% in the first half hour to 15.40.

    Currently testing March lows.

  3. einai


    ... down 20%
  4. einai


    ... retesting the day's low, down 22%
  5. Great call
  6. einai


    Thanks !

    I was just about to post asking if anyone came along for the ride.


  7. einai


    Sorry if this is getting tedious.

    On the other hand, if you'd followed my advice at the open today, you could have made a 16% profit.

    Anyhow, I ran the numbers: in essence, the stock went from estimated earnings for the year of $0.55 to - optimistically - $0.37.

    Actually, there's reason to believe that things are much worse. But even if not, this stock should be trading at $11.50 if it held its P/E from the day before earnings.

    And it had that P/E assuming growth, as opposed to losses.

    So there's probably another $1-2.00, at the outside $3.00, or 25% to be shorted away here.