Old PSG Wind-Down Ltd PSGLQ

The Future of PSG?

[kennethjw]

When will PSG recover?

I figure 2018 for the recovery.  I wouldn’t expect a “take-off” any time soon.
 
- lower bat sales in 2017 will be a drag on the baseball segment, until new BBCOR regulations take effect in 2018 for the youth/junior associations
- the market is flooded with cheap inventory due to the liquidation of Sports Authority (among others), it will take time for the consumer to work through this product
- weak Canadian dollar is here to stay, and the strong US dollar also seems likely to stick around (given the strength of the overall economy … time to raise rates) … but who knows, maybe if Trump gets elected the US dollar will tank?
- the consolidation of sports retailers in the US will also be a short-term headwind as consumers will have to change their spending behavior PSG see’s a pickup in the purchase orders.
 
Most importantly, management need to reduce their leverage and pay down the credit facility due in 2019.  Less spending on “product integration” and improved operating performance will be needed.
 
The business isn’t broken – they own the best brands in their segments and kids are going to continue to play sports.  If they continue to flounder – privatization seems plausible given Sagard’s huge stake in the business.
 
If they manage their balance sheet and navigate all these short term headwinds, this company will be worth a lot more in the next few years than it's current valuation.

All IMHO.

[snowys1]

sound about right, thank you patience will be the key. I own easton hockey sticks and they are the best imo ;)

[jaja18]

Yes I agree with you Kennethjw and great post. In the near team, PSG is a way oversold on the RSI and WilliamR indicators and we could experience a temporary bounce up as this type of selling pressure is not sustainable but its only an indicator and nothing is for sure. I believe the future is bright with new CEO and entering retail space. I just hope it doesn't bite them where it hurts

[snowys1]

I think new stores is good for the near term because consumer like new things and they will surely buy into it. Also this will help them to clear up inventory. Also, I don't think only 10 stores could really hurt their business with their retailers.. retailers still need to get new products to get sales going in their store. We also have to mention that PSG cut the sales by themselve because

[theWizzz]

Always very tricky to start competing with your own clients...   it is a fine balance. However, when it is done properly --- hence, the NIKE store example ---  it can provide tremendous value. I imagine PSG must have determined the best geographical areas to put these stores...  I also hope they put-in a lot of thought in the "look n feel" of the stores.  If they

[kennethjw]

Impressive Under Armour "lifestyle" studio, thanks for sharing. All of the big players have their own dedicated shops (UA, Nike, Adidas, etc.) and I think it's a great way for PSG to build brand recognition around Bauer. However, based on the last earnings call, management noted that they have only opened up 2 Own The Moment stores and the remaining 8 stores will not be rolled out