Top Brands Generate Steady Profits

Article Excerpt

The apparel industry is typically more risky than other segments of the Consumer Goods & Services sector, such as fast food outlets and beverage makers. It takes months to design and make clothes, so it’s hard to respond to changing fashion trends. That’s why it pays to stick with well-established companies, like these three, which have built up a portfolio of high-quality brand names. These brands provide steady income, even during poor economic conditions. Their situations vary, but all three are buys. LIZ CLAIBORNE INC. $42 (New York symbol LIZ; Aggressive Growth Portfolio, Consumer sector; WSSF Rating: Average) designs and markets women’s clothing and accessories under numerous brands, including Liz Claiborne, Mexx and Ellen Tracy. It sells its products through major department stores as well as roughly 660 company-owned specialty stores. It also makes men’s clothing, and licenses its many brands to non-apparel manufacturers. The company’s revenue grew from $3.45 billion in 2001 to $4.85 billion in 2005, partly due to acquisitions. Earnings rose from…

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