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AYI: 3Q10 Consensus Revenue Expectations Look Reasonable, Expect EPS Upside in the Form of Continued Gross Margin...

June 29th, 2010

AYI will report 3Q10 results before the market opens tomorrow. We expect the company to deliver inline revenues, but once again top consensus estimates due to better than expected gross margins. ...

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MLHR Misses (Again), Even With Acceleration in Order Activity Consensus For FY11 Needs to Come Down

June 23rd, 2010

MLHR reported 4Q10 earnings after the close.  You can read the full release here.  Overall, the company's revenue and earnings results fell well short of consensus and PAA Research's even more cautious estimates....

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MLHR: The Theme In the Office Furniture Market Appears to be Stagnation More than Acceleration

June 10th, 2010

Approximately three months ago, we introduced MLHR as a short idea.  At that time we thought shares were poised to witness downside following a 25% run up in the stock. even though sell through trends in the office furniture...

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TTC: 2Q10 Upside More than Overshadowed by Threat of Slowdown in the US, Golf and European Headwinds

May 21st, 2010

TTC reported 2Q10 results earlier today.  You can read the full release here.  The company's earnings results were inline with TTC's positive pre-announcement on 5/13.Key Observations from TTC's 2Q10 ResultsHere are...

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BGG: Crushes 3Q10 EPS Expectations, but Guides Lower - Four Reasons Why We Think The Stock Can Still See Downside

April 22nd, 2010

We recently introduced two short ideas: TTC and BGG.  Both are leading manufacturers in the outdoor power equipment market.  Our thesis on the two companies was as follows: Our channel checks indicated...

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Time to Grab the "Bull" by the Horns, Getting Short TTC and BGG

April 19th, 2010

The outdoor power equipment sector is an industry whose revenue growth trends have historically been driven by three primary factors: home sales, general consumer confidence, and weather.  It should come as no surprise given these factors that unit sales...

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Can AYI's 2Q10 Results Justify the Run-up in the Stock? What Channel Feedback Tells Us - Closing Out Our Long AYI/Short...

March 26th, 2010

Approximately four months ago we introduced a pair trade: long AYI/short HUBB based on our view that AYI shares were poised for mean reversion in stock price performance relative to those of HUBB and...

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MLHR Misses, Street Estimates for FY10 and FY11 Still Look TOO High

March 22nd, 2010

MLHR reported 3Q10 results after the close.  You can read the full earnings release here.  Overall the company missed on both the top and bottom line.  We introduced MLHR as a short idea earlier this week based on our expectations that revenue...

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In the Office Furniture Market the Second Derivative Is Improving, but Maybe Not Quickly Enough – Closing Out Our...

March 14th, 2010

In July of 2009 we introduced a pair trade: Long MLHR/Short HNI.  Our thesis at that time was predicated on the following: MLHR is a superior company to HNI based on almost every financial...

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Our Expectations for AYI’s 1Q10 Results, the Company Has Plenty of “Dry Powder” Heading Into 2010

March 12th, 2010

This report was originally published on 1/4/10.A few weeks ago we introduced a pair-trade: long AYI/short HUBBbased on our expectation that AYI shares were poised to witness absolute and relative upside following an...

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Shedding Some “Light” On a New Pair Trade Idea: Long Acuity Brands (AYI)/Short Hubbell Inc. (HUBB)

March 11th, 2010

This report was originally published on 12/3/09.We have been long-time admirers of the business models of the leading electrical product manufacturers including: Cooper Industries, Thomas and Betts, Hubbell...

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PAA Research SMid Cap Portfolio Update, Closing Out BGG Short Trade Idea with a 7.4% Gain

March 11th, 2010

This report was originally published on 11/2/09.We wanted to provide you with an update on the performance of our SMid Cap portfolio, which we introduced on 9/3/09.  You can find our initial report here.  As a reminder this is...

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It’s Still Too Early for BGG, Getting Short Into Earnings as a Trading Call

March 10th, 2010

This report was originally published 10/19/09.One of the first investment ideas we introduced on this site was a short-term trading call onBriggs and Stratton (BGG 18.42 ↓0.65%).  You can read our original report here.  At that time we...

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The State of the Office Furniture Market – Still Recommending Long MLHR/Short HNI

March 10th, 2010

This report was originally published on 9/10/09.In our original report on the office furniture market entitled: “Generating Returns in an Industry in a Deep Freeze” we advocated going long Herman Miller (MLHR 20.04...

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Our Long MLHR/Short HNI Has Gone From a Catalyst Driven Trade to a Relative Value Trade, but We Still Like it

March 10th, 2010

This report was originally published on 7/26/09.Our pair trade recommendation to go long Herman Miller Inc. and Short HNI Corporation got off to a bumpy start. The trade has returned -6.4% compared to a 4.1%...

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Generating Returns in an Industry in a Deep Freeze – Long Herman Miller Inc. (MLHR)/Short HNI Corporation (HNI)

March 9th, 2010

This report was originally published 7/20/09.Investment Thesis Overview:In the debate over “green shoots” we have directed our attention in large part to the state of the housing market as an indicator...

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Briggs and Stratton’s (BGG) 3Q09 – The “Holy Trinity” for Shorts? A Miss, Reduced Guidance and a Reduced...

March 6th, 2010

This report was originally published on 4/16/09.BGG reported 3Q09 results this AM and it appears that our expectations and thesis were right on point. Revenues and EPS of $673.8 million and $0.51,...

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One for You Traders Out There: Short BGG Into Earnings (this Thursday)

March 6th, 2010

This report was originally published 4/14/09BGG’s stock has increased 18% over the past month, which we attribute to the following: Increased investor appetite to own cyclicals, growing investor anticipation that a bottom in housing could be...

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Current Ideas

EXPI

SELL/SHORT

$4

HUSQ.B

SELL

$50

UFPI

SELL/SHORT

$45

TREX

SHORT

$18

PRDO

SELL/SHORT

$5

STRA

SELL/SHORT

$42

CWH

LONG

$75

OSTK

LONG

$128

CM

SELL/SHORT

$50

RY

SELL/SHORT

$50

ARC

LONG

$5.50

AYI

SHORT

$50

BIG

SHORT

$28

WWE

LONG

$65

XOXO

LONG

$37

RLGY

PAIR TRADE

$10

RDFN

PAIR TRADE

$30

BCO

LONG

$35

ING.PA

SHORT

$35

TRUP

SELL/SHORT

$10

CTC

SHORT

$101

ATGE

SHORT

$15

HCG.TO

SHORT

$0

RON.TO

SHORT

$9

ESI

SHORT

$0

BGG

PAIR - LONG BGG/SHORT TTC

25%

TTC

PAIR - LONG BGG/SHORT TTC

25%

Z

SHORT

$14.00

NA.TO

SHORT

$22

ZU

SHORT

$15

TRLA

SHORT

$20

MCRS

SHORT

$31

APOL

SHORT

$35

OPEN

SHORT

$30

KNL

PAIR - LONG KNL/SHORT MLHR

25%

CSGP

SHORT

$100

GCA

LONG

$8

IPSU

LONG

$20

MLHR

SHORT

$22

LOOP

PAIR - LONG CSGP/SHORT LOOP

40%

THQI

LONG

$35

WPO

SHORT

$275

COCO

SHORT

$0

HNI

SIG

RGR