Stock Interest List Update

There were a lot of earnings reports out today.

SHOO - reported 1Q09 preliminary sales and EPS figures as well as some guidance for FY09. Expected sales for 1Q09 of $106.5 million were 10.9% above consensus and expected EPS of $0.36 was 50% above consensus. Similarly, the stated FY09 EPS guidance of $1.90 was 28.4% above prior guidance of $1.40 - $1.55, and 29.3% above consensus. A truly big surprise.

With this surprise, SHOO has gone well through my price target. Although the stock does not look unreasonably expensive, the margin of safety to the downside is no longer in place. While SHOO returned 45.94% in the time since it was placed on the interest list, the S&P 500 returned (1.92%). I am removing SHOO from the interest list.

TSCO - reported 1Q09 results by no means as stunning as SHOO's. Same store sales of +2.6% and store growth of 28 stores. The Company confirmed prior sales and earnings targets for FY09. The negatives included the Company saying April had gotten off to a slow start for seasonal merchandise due to cold weather, as well as, lower selling prices year-over-year due to the inflation see last year. TSCO also mentioned margins may be pressured as a result.

TSCO maintained its guidance, saying that April was just due to weather. It also increased its store count target. As the stock does not look overly expensive, there is still clear growth potential, and it has not reached my price target, it will remain on the Long Interest List.

-2outof4