ebook essays pieces of the puzzle
Wednesday, January 18th, 2012
something about mary

Who is Mary?  In the words of Eric Wieffering in the StarTribune, “a 50-ish, small town-living, minivan-driving mother who, after helping make C&B one of the hottest stocks in the land, found her way on to Page 1 of the Wall Street Journal.”

C&B is Christopher & Banks (CBK), which provides here a short lesson in knowing your customer and the fickle nature of retail stocks.  When CBK was in tune with Mary, its business exploded and so did its stock.

For whatever reason, the company forgot about Mary and has been in a downward spiral for several years.  In the top panel you can see how the stock trounced the consumer cyclical ETF (XLY) for a long time, but that has all been given back and more.  The fundamental numbers in the lower two panels tell the tale of continued deterioration.

It has not been a wonderful retail environment since the turn of the century, especially for apparel retailers, but this is a classic example of a competitive advantage that was squandered.  (Chart:  Bloomberg terminal.)

the founder

Christopher & Banks used to be known as Braun’s Fashions.  Gil Braun started out with one store and ended up thirty years later with 113 before selling the company.  He passed away a few months ago at the age of 96.  He was a generous man who never lost sight of the customer or her needs.  Years ago, I was lucky to have the chance to get to know him.