GICS Sector : Consumer Cyclical
Destination XL Group, Inc., together with its subsidiaries, operates as a specialty retailer of big and tall men's clothing and shoes in the United States and Canada.Its stores offer sportswear and dresswear; fashion-neutral items, including jeans, casual slacks, T-shirts, polo shirts, dress shirts, and suit separates; and casual clothing.It also provides tailored-related separates, blazers, dress slacks, dress shirts, and neckwear; and vintage-screen T-shirts and wovens under various private labels.
DXL reported a decline in net sales to $101.9 million, a 5.5% decrease from the same period last year. The gross margin rate, inclusive of occupancy costs, was 42.7%, a decline of 210 basis points from the same period last year. The company's EBITDA for the quarter came in at a loss of $2 million, compared to earnings of $1 million for the same period last year. The actual EPS came out at -$0.08, relative to estimates at -$0.035, indicating a significant miss.
Publication Date: Dec -20
The merger with FullBeauty is expected to generate $25 million in run-rate annual cost synergies by 2027, which will be achieved by streamlining factories and resources for product creation, improving inbound freight and logistics, and leveraging improvements in outbound shipping rates. As Peter Stratton mentioned, "we're targeting $25 million of run-rate cost synergies, which will be achieved through organizational efficiencies, reduced overhead, and commercial synergies."
With a P/S Ratio of 0.11 and an EV/EBITDA of 5.71, the market seems to be pricing in a significant recovery in the company's financial performance. However, with analysts estimating a revenue growth of -7.1% next year, it's unclear if the current valuation is justified. Additionally, the company's ROE and ROIC are both negative, at -7.23% and -1.47% respectively, indicating a challenging operating environment.
The combined company will have a term loan outstanding at closing of approximately $172 million and a maturity of August 2029. The total debt will be $172 million, with an interest rate of LIBOR plus 750. The company's capital structure will be impacted by the merger, with FullBeauty owning 55% and DXL owning 45%.
The merger is expected to close in the first half of fiscal 2026, subject to customary closing conditions and approval by shareholders of DXL. Upon close, the company will trade under the ticker symbol DXLG, with Jim Fogarty serving as CEO and Peter Stratton as CFO. The combined company is expected to have a strong financial foundation, with a proven management team and a significant presence in several markets.
Destination XL Investor Alert: Kahn Swick & Foti, LLC Investigates Merger of Destination XL Group, Inc. - DXLG
Jan -24
Allbirds (NASDAQ:BIRD) vs. Destination XL Group (NASDAQ:DXLG) Financial Contrast
Jan -19
Destination XL Group, Inc. Reports Holiday Sales Results
Jan -12
Financial Comparison: Destination XL Group (NASDAQ:DXLG) and Christopher & Banks (OTCMKTS:CBKCQ)
Dec -25
Destination XL Investor Alert By The Former Attorney General Of Louisiana: Kahn Swick & Foti, LLC Investigates Merger of Destination XL Group, Inc. - DXLG
Dec -15
Destination XL Group And FullBeauty To Create $1.2 Billion Merger
Dec -15
Shareholder Alert: The Ademi Firm investigates whether Destination XL Group Inc. is obtaining a Fair Price for its Public Shareholders
Dec -12
Destination XL Group, Inc. (DXLG) Q3 2026 Earnings Call Transcript
Dec -12
Destination XL Group, Inc.'s 4.5% growth is driven by increasing demand for big and tall men's apparel, effective omnichannel strategy, and strategic store openings. Additionally, the company's focus on providing a wide range of products, excellent customer service, and loyalty programs contribute to its growth.
Destination XL Group, Inc.'s 5.5% growth is driven by increasing demand for big and tall men's apparel, effective marketing strategies, and expansion of e-commerce platforms. Additionally, the company's focus on providing a wide range of styles and sizes, as well as its loyalty program, contribute to customer retention and acquisition.
Destination XL Group, Inc. offers a wide range of casual apparel for men, including shirts, pants, jeans, and outerwear from popular brands.
The company offers a variety of dress shirts in different styles, fabrics, and sizes to fit men of all shapes and sizes.
Destination XL Group, Inc. sells a range of polo shirts from popular brands, offering a classic and versatile style for men.
The company offers a variety of outerwear, including jackets, coats, and vests, to keep men warm and stylish in different weather conditions.
Destination XL Group, Inc. specializes in providing clothing for big and tall men, offering a wide range of sizes to fit men of all shapes and sizes.
The company sells a variety of shoes, including dress shoes, boots, and casual shoes, to complement its clothing offerings.
Destination XL Group, Inc. faces moderate threat from substitutes as customers have limited alternatives for big and tall clothing, but online retailers and specialty stores offer some substitutes.
Destination XL Group, Inc. has a low bargaining power of customers as customers have limited options for big and tall clothing, and the company has a strong brand presence.
Destination XL Group, Inc. has a moderate bargaining power of suppliers as it relies on a few large suppliers for its products, but has some flexibility to switch suppliers if needed.
Destination XL Group, Inc. faces a low threat of new entrants as the market for big and tall clothing has high barriers to entry, including high startup costs and the need for specialized expertise.
Destination XL Group, Inc. operates in a highly competitive market with several established players, leading to a high intensity of rivalry among competitors.
| Value | |
|---|---|
| Debt Weight | 50.92% |
| Debt Cost | 3.95% |
| Equity Weight | 49.08% |
| Equity Cost | 10.83% |
| WACC | 7.32% |
| Leverage | 103.75% |
Value: 6.7
Growth: 1.7
Quality: 2.0
Yield: 0.0
Momentum: 9.5
Volatility: 3.3
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Value: 10.0
Growth: 4.4
Quality: 4.2
Yield: 0.0
Momentum: 0.5
Volatility: 1.0
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Value: 5.5
Growth: 2.8
Quality: 2.8
Yield: 5.0
Momentum: 1.5
Volatility: 1.0
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Value: 5.4
Growth: 3.0
Quality: 2.7
Yield: 0.0
Momentum: 4.5
Volatility: 2.0
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Value: 8.0
Growth: 3.9
Quality: 3.4
Yield: 0.0
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Volatility: 1.3
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Value: 8.5
Growth: 1.0
Quality: 3.9
Yield: 0.0
Momentum: 1.0
Volatility: 0.7
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