Finish Line, Inc. Is an Term Paper

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If the stock trades that low, or if it starts an upward trend anytime soon, purchasing the stock would probably be a good idea.

Recommendations to purchase the stock for a long-term hold would probably ensure that investors would be happy with the outcome, as long as they were willing to hold the stock for at least a year or two. Average rate of return over the next couple of years could be close to 20% based on past performance and flat sales and profits. Bank of America says that the target price is $12, and if that holds true and an investor can purchase the stock at close to the $10 range then a twenty percent return on investment over the next 12-18 months is quite feasible.

The risk in the stock is if management does not rectify the revenue issues and sales continue to fall. Their profitability is fairly high and much higher than it was just two years ago when the stock was trading in the same range.
The charts show that it has hit the support level, and unless it breaks through that support and trends even lower, now could be the time to buy. One other item of note, the company is much smaller than many of its competitors but operates over 670 stores in 48 states which might make it an attractive takeover prospect. A bidding war for its shares could substantially reward investors.

If, by chance, management can solve their sales issues and get the company back on track the a $10 purchase price two years hence might….....

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