What are the people who are currently dumping DLA below 9$ after the stellar first quarter thinking?

Here's a little arithmetic to show you the company's estimates of 80cts-1$/share in fiscal 2010 are BOGUS... i.e., ridiculously low!

30cts/share* + (12cts/share savings realized in 2nd 1/2 of fiscal 2010 due to closing of Lafayette facility**)x.7 + (20cts/share savings by running facilities at 100% capacity***)x.7 = 52cts/share

(the .7 factor is for taxes)

and

*first quarter eps

**The movement of production will begin in the Company’s third fiscal quarter and is scheduled to be complete in June 2009. The cost of this transition is not expected to be material. The closing of the Fayetteville Plant is expected to save the Company approximately $1 million annually once the transition of the fabric production is complete. The Company anticipates this favorable financial impact will be realized in its results of operations in the second half of fiscal 2010.

***listen to the latest conference call. CFO says it cost them 1.7 million to run facities at less than full capacity in last 2 quarters of fiscal 2009.


Now let me add to the 52cts/share already in the bag flat year over year results for the last 3 quarters*

52cts/share + 7cts/share + 14cts/share + 47cts/share = 1.20$/share

* I consider this is an INCREDEBLY conservative assumption due to the much improved economy going forward relative to the panic that happened during the last fiscal year

Clearly Delta Apparel is on its way to easily exceed the high end of its fiscal 2010 estimate (1$/share). It is not WHETHER but WHEN this company will raise its guidance.

I personally expect Delta Apparel to earn 1.35$/share in fiscal 2010 and the stock to trade at 1.35 x 15p.e. = 20$ sometime during the coming 12 months.

Good luck to all, including the losers selling this stock below 9$ today.