Kirkland's Inc.

Kirklands, Inc. (KIRK - Analyst Report) shares are skyrocketing after a solid earnings report, yet are still trading at excellent valuations.

Company Description

Kirklands Inc. is a leading specialty retailer of home decor in the United States. The stores present a broad selection of distinctive merchandise, including framed art, mirrors, candles, lamps, picture frames, accent rugs, garden accessories and artificial floral products.

Kirklands stores also offer an extensive assortment of holiday merchandise, as well as items carried throughout the year suitable for giving as gifts.

Sales, EPS Up

Kirkland reported fourth-quarter results on Mar 20 that included a 5.3% increase in same-store sales. The rise in sales came one year after comparable stores saw a 12.6% decrease.

The strong sales resulted in earnings per share of 59 cents, 13.5% higher than the consensus of 52 cents. Fourth-quarter earnings per share came in at just 8 cents in the same quarter last year.

Robert Alderson, Kirkland's President and CEO said, "Our goal for the year was to show improvement in every quarter, and we more than exceeded that target." He continued,"While it is early yet, we are also encouraged by positive sales and margin trends experienced so far in the first quarter of 2009."

Solid Valuations

Shares of KIRK are exchanging hands are roughly 12 times earnings, not a bad value. The growth rate is also reasonably priced as the stock carries a PEG ratio of just 0.8.

Full-year estimates for fiscal 2010 have spiked since the earnings report and now average 46 cents, up from 29 cents just 30 days ago.

If the forecast is reached, the company will experience year-over-year earnings growth of 53 %.

The Chart

As shares have made their way back above the $5 level they should now garner some attention from institutions that are restricted from owning shares under $5. The stock shows no sign of slowing yet still presents a great value. Take a look at the chart below.