The group is suffering alongside other big ticket retailers from the economic downturn. Total sales orders fell by 47 per cent in the three months to November 2nd.
It added recently: “We expect market conditions to be challenging and uncertain for the remainder of 2008 and 2009 which includes the important January sale period.”
Shares, which floated at 149p in 2005, closed at just 9p on Monday, giving it a market capitalisation of around £4.5 million. Despite the slump, Land of Leather said it would protect remaining shareholder value.
Based on the currently traded price of 6p it puts the market cap at £2.1m according to Yahoo. However, the Irish Times wnet on to say it has £6.9m in cash with no debt:
In October Land of Leather revealed that its annual pre-tax profits had dived to £2.3 million, down from £18.5 million the previous year, while like-for-like sales orders had fallen by 28.9 per cent. But on the plus side, the company is debt free, and reported £6.9 million of cash.
According to its price history the stock is heading towards November lows have closed its recent breakout gap and challenging the massive breakout gap from the summer.
I've created a call for this stock to challenge the upper part of the range with a target of 13.49p with a stop below 3.75p support at 3.69p.
If you have an opinion on this stock we would like to hear about it - make a YourCall today.
Dr. Declan Fallon, Senior Market Technician, Zignals.com the free stock alerts, market alerts, and stock charts website
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