Negative K-Swiss sentiments

I just listened to the K-Swiss conference call and came off with very negative sentiments.

Not only does management seem to be ignoring the fact that its domestic business is continuing to free fall - spent more time talking about athletes it has marketing contracts with than about it negative growth and how to fix that - Royal Elastics, who's 2006 profitability was part of my original thesis, continues to lose double digits cents per share.

I'm heavily disappointed with this - as is the market who has sent its shares down $5 in the last week - and almost sold my shares this morning.

However management has proven itself able to continually produce good returns on capital, its returns remain above the rest of the shoe industry at 21%, and is now trading at only 12x cash flow.

Thought I may have been stupid enough to hold my shares above $40 I'm not stupid enough to sell them at $23 when its the cheapest stock, earnings wise, I own and has a history of good capital management - it still has the best returns and best balance sheet in the industry.

Adding Cash

I will be adding $3000 to my account in the next week and will be using this to increase current position sizes and start new positions in two stocks I've been analyzing over the past few weeks.