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Armchair Trader pick: Buy & Hold portfolio

  • Genesco Inc (NYSE:GCO)
  • Sector: Clothing (Footwear)
  • Market cap: GBP 648m
  • Entry price: $62
  • 3 year high: $73.49
  • Target price: $75
  • Stop loss: 20% (trailing)

This week's pick is strongly positioned in the retail footwear segment, but with a good distribution network that stretches well outside its core US market, including stores and brands in the UK. Genesco Inc (NYSE:GCO) has done very well for investors since it rallied from pandemic lows in Q2 2020, but is still trading at around  8.2x PE (12m forecast rolling).

That's pretty good value for a stock that was trading at less than $20 in December 2020. There has been a real reversal of fortunes at Genesco since Q1 in 2021, and it has had a fantastic 12 months. The company has a market cap of £648m at time of writing against £1.85bn in revenues. The question is whether it can continue to perform at a time when inflation is off to the races? We think shoes are still going to be important to consumers.

 

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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