Wednesday, August 30, 2006

TRLG Update: Strong Buy

Jeff Lubell States the Obvious and Buckley outlines growth strategy.

This article is fairly on-point. A couple points I disagree with, however:
1. UARM is doing better because it is a brand that most traders know and nobody has doubts about people buying sweat-wicking sportswear, whereas they always do about any premium fashion. I don't think going public through a reverse merger, as the Routers article stated, has an impact on TRLG's current valuation, especially since it became NASDAQ listed over a year ago. They need to face the facts - right now the market doesn't get you, it hasn't got you since you've been public so go and get bought with a strict agreement allowing you to continue operations with the same management team, get a nice capital infusion from the buyer and exit with a true IPO in a couple years if you feel the time is right.

2. Surfwear - This market is cornered right now, and there are actually plenty of high-end $60 -100 boardshorts out there. TRLG shouldn't expand that far, rather they should become the new, more premium, Deisel.

All that being said - these guys are going to have more good news. Hold them tight, and buy at anything below 20.

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