This party retailer just announced it would acquire a master franchise group representing 21 franchise stores in the Minnesota, North Dakota and Texas markets. The franchise group had sales of $33.5 million last year.
Party City Holdco Inc. (PRTY)
From AlphaProfit Sector Investors’ Newsletter
Party City Holdco Inc’s (PRTY) strategies to increase profits are working. The leading party supplies retailer has been buying franchise locations to grow revenues and increased vertical integration via direct sourcing and self-manufacturing to increase operating margin to 14%.
The external milieu should work to Party City’s advantage in 2019 and beyond as Halloween calendar turns favorable and franchise movies like Frozen 2 drive demand for licensed product sales.
Trading at 8.1X-forward EPS versus prospects of 35% EPS in the next 12 months, Party
City shares interest growth-at-a-reasonable-price investors. (Next earnings: ~ Nov. 1)
Sam Subramanian, PhD, AlphaProfit Sector Investors’ Newsletter, www.alphaprofit.com,
281-565-6963, September 2018