Cramer: This Stock Seems Cheap to Me

(Click for video linked to a searchable transcript of this Mad Money segment)

Jim Cramer is always searching for under the radar stocks and his screen has started to blip again.

"I want to introduce you to Iconix Brand Group," said the Mad Money host.

Iconix owns a diversified portfolio of fashion and home retail brands which includes Joe Boxer, London Fog, Candie's, Danskin and more.

Although Iconix owns its brands, it licenses them to leading retailers and manufacturers worldwide. "It's those manufactures and retailers who actually make and sell the products," Cramer explained. "In return, they pay Iconix a royalty for the license."

Cramer likes the business model and believes it should be very profitable. "Remember, Iconix doesn't have to worry about inventory or raw costs, they just need to manage their portfolio of brands and make good licensing deals," Cramer said.

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Recent results seem to confirm the thesis.

According to Zaks, on Apr 24, Iconix reported first quarter 2013 earnings of 54 cents per share beating last year's result by 26% and the Zacks Consensus Estimate by 5.9% on the back of top-line growth. Iconix's revenues in the quarter surged 19% year over year and surpassed the Zacks Consensus Estimate by 4%.

The upswing was driven by a spate of accretive acquisitions made in the recent past.

Looking at the price action, Iconix has rallied about 36% since the beginning of the year. Although those gains are substantial, Cramer thinks the stock is still a value when compared to peers.

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Cramer says rival PVH sells for 15 times earnings with a 12% long-term growth rate. By contrast, Iconix sells for less than 13 times earnings, a lower multiple, even though it has a higher, 18% growth rate.

All told, "Iconix seems cheap to me," he said.

Call Cramer: 1-800-743-CNBC

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