Childrens Place Inc. operates as a children's specialty apparel retailer, selling apparel, accessories, footwear, and other items for children. The company was founded in 1969 and is based in Secaucus, New Jersey.
PLCE Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Childrens Place Inc. To summarize, we found that Childrens Place Inc ranked in the 76th percentile in terms of potential gain offered. Moreover, under all the scenarios we modelled, the output consistently forecasted positive returns. The most interesting components of our discounted cash flow analysis for Childrens Place Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 11.79; that's higher than 78.53% of US stocks in the Consumer Cyclical sector that have positive free cash flow.
Childrens Place Inc's weighted average cost of capital (WACC) is 6%; for context, that number is higher than just 4.06% of tickers in our DCF set.
PLCE's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than just 4.06% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
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Children's Place Inc. said Monday that it sales for the first quarter fell 38% to $254 million, below the FactSet consensus of $303 million for the quarter. The children's apparel retail says digital demand surged 400% through May 16, and as of late April, the company has used 85% of its stores to fulfill orders. Children's Place is scheduled to announce first-quarter earnings on June 11. The company has $72 million in cash and equivalents, no long-term debt and $235 million outstanding on its $360 million revolving credit facility. The company will reopen stores across 10 states on Tuesday, including Idaho, Mississippi and both North and South Dakota. More than 40% of the company's stores are in states that have not been authorized for reopening. Stores that do reopen will take measur...
The Children’s Place, Inc. (PLCE), the largest pure-play children’s specialty apparel retailer in North America, today provided a business update and details on its phased store reopening plan. To help fulfill its surging online demand, the Company enabled its ship-from-store capabilities in approximately 85 percent of its U.S. stores in late April, which more than doubled its daily shipping capacity. As of May 2, 2020, the Company had approximately $72 million of cash and cash equivalents with no long-term debt, and $235 million outstanding on its $360 million revolving credit facility, which was increased from $325 million as a result of finalizing an amendment with its lenders on April 24, 2020.
As retailers continue to grapple with the impacts of coronavirus in an already struggling environment, another chain is reportedly preparing to close its doors for good. J.Crew’s filing for bankruptcy protection could come as soon as this weekend, according to The Wall Street Journal. The company suspended its initial public offering of its Madewell brand after it failed to reach a deal with creditors back in March.