No bed of roses for furniture stocks, a bed of money
posted September 30, 2009 - 9:11pm
I did an article back in February on furniture stocks, which really didn’t make sense. At the time it was very questionable if you could make any money in the housing market. So I took a look at what went in a house, furniture.
Well if you read my article back in February and took a seat with furniture stocks you would have made a ton of money.
First, let me point out. No, I’m no stock guru of any kind. I just started paying attention to the stock market in 2006. I’m still learning just like everyone else. But it just goes to prove with just a little research you have a chance of hitting a good one in the market.
We had just had the worst January in history for the stock market. In February, I noticed that furniture stocks did hold their own against the hard times. So I took a detailed look at the past history of the retail home furniture stocks. I ended up highlighting two stocks, Kirkland Inc. (NASDAQ: KIRK) and Ethan Allen (NYSE: ETH). Kirkland was up 16 percent ($0.43) from Jan. 1. But that’s nothing. The stock was up 289 percent from last year at the same time, climbing from $0.79 a share to $3.08 a share.
Kirkland is a specialty retailer of home decor in the United States. As of Jan. 31, the company operated 299 stores in 34 states. The company’s stores present a selection of merchandise, including framed art, mirrors, wall decor, candles, lamps, decorative accessories, accent furniture, textiles, garden accessories and artificial floral products. Its stores also offer an assortment of holiday merchandise, as well as items carried throughout the year suitable for giving as gifts.
My article came out on Feb. 17 with Kirkland sitting around $3.08 per share. Today, Kirkland is sitting at $14.05 per share, jumping 359 percent ($10.97). A nice run in a six-month period. A little down side to Kirkland, no dividend.
But if you’re looking for a good retail home furniture dividend stock, take a look at Ethan Allen.
Ethan Allen is a manufacturer and retailer of home furnishings and accessories, offering a complement of home decorating and design solutions through home furnishing retail networks. The company’s operations are classified into two operating segments: wholesale and retail. The wholesale segment is principally involved in the development of the Ethan Allen brand, which encompasses the design, manufacture, domestic and off-shore sourcing, sale and distribution of a range of home furnishings and accessories to a network of independently owned and Ethan Allen-operated design centers, as well as related marketing and brand awareness efforts. The retail segment sells home furnishings and accessories to consumers through a network of company-operated design centers.
In February, Ethan Allen's stock was way down. Standard & Poor's Ratings Services placed Ethan Allen on CreditWatch with negative implications.
S&P credit analyst Rick Joy said the listing "reflects our continued concerns" about the company's difficult operating environment and its second-quarter earnings results, which did not meet its expectations.
The home furnishings company announced Feb. 5 that its profit fell 73 percent in the quarter.
The stock was down 19 percent ($2.79) from Jan. 1 to Feb. 10. Over the past year the stock was down 59 percent ($16.83).
Again, my article came out on Feb. 17 with Ethan Allen sitting around $11.58 per share. Today, Ethan Allen sits at $17.08 per share, a 47 percent jump ($5.50). Not as good as Kirkland, but a nice run with a dividend.

Comments
Good Article
Like your interpretation of World News. It's just not regurgitating it. It provides analysis. More people should have listened to your crystal ball.
Really appreciate your insights and research...
Hope you will keep sharing these with us on a regular basis. Thank you.
Good Investing Advice
I liked your invesing article. I'll pay close attention to furniture stocks, a sector I never gave much notice before.
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