Dec. 3 at 8:06 PM
$DXLG has a similar setup to
$DIBS this Summer. DXLG is a literal penny stock with over
$33M in cash comprising well over 50% of the market cap and no debt. Despite revenue declines they have managed costs and reported minimal losses. So another situation in which the business is priced to burn cash into perpetuity, despite it not burning much cash at all, and any whiff of good news would send it skyrocketing
LTM revenues are ~
$450M and EBITDA is ~9m, meaning it trades at ~2-3x an Enterprise Value of
$23M. They are a discount retailer like TJX or ROST but catering specifically to the plus sized male category and a significant private label business (so more like CTRN in that respect). People are trading down so it it is in an appealing market and we are approaching three years of negative revenue growth - because they have rightsized their cost structure, if/when the comps turn positive the margins should inflect rapidly. In 2022 they earned ~
$90M in net income
