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It’s another play on the “aging baby boom” angle: Inglewood-based Signature Eyewear Inc. says in its prospectus that the graying of the U.S. population means lots of once-hip boomers are going to be groping their way to eye doctors for reading glasses or other spectacles.

Slated to go public, Signature Eyewear is an importer and marketer of eyeglass frames.

Signature sells frames under the the brand names Laura Ashley Eyewear, Hart Schaffner & Marx, Jean Nate Eyewear and its own Camelot label. The frames sell in mid- to upper brackets of the retail scale, from $60 to $180 a pair. They are carried by Lenscrafters, Pearle Vision, Eyecare Centers of America and independent opticians and optometrists.

The company also plans to market an Eddie Bauer Eyewear line, to be launched next spring.

In the fiscal year ended Oct. 31, 1996 (the latest reported full year) Signature posted net income of $1.3 million (36 cents a share) on revenues of $28.3 million. The company has put together five straight years of improving sales and net income. It is expected to issue common stock at about $10 a share and have about 5.2 million shares outstanding, for a market capitalization of $52 million.

About 1.8 million shares are being sold to the public, the proceeds of which will be used to pay down debt, get the Eddie Bauer line up and running, and for general corporate purposes.

The Los Angeles offices of securities firm Van Kasper & Co., led by Bruce Emmeluth, is co-underwriter on the deal.

Company officers and investment bankers were in their “quiet period” last week.

The Dow

Old habits die hard, and one daily media ritual that seems as strong as ever is the quoting of the Dow Jones Industrial Average, which is made up of 30 blue-chip stocks. The routine includes detailing the number of points not the percent that the Dow was up or down.

In the last few years this practice has become more and more dubious, as blue-chip stocks have increasingly diverged from the rest of the stock market (blue chips have had a historic bull run).

One local investor, who likes to study (and then invest in) local small-cap stocks, exclaimed, “This is the most painful bull market of my life” (although small caps have started to outperfom the blue chips).

For whatever reason, it appears there are going to be periods sustained periods, running into the years in which blue chips either under- or over-perform the bulk of mid- or small-cap stocks.

In addition, the point swings on the Dow today seem huge, even if one is consciously aware that the Dow is trading at near 8,000. It’s just hard not to be impressed by point swings in the hundreds.

A more meaningful presentation would be to state first the percentage by which the Dow is up or down, and then mention points.

But I’ll be the first to admit that journalistic shibboleths die hard, and we’ll probably hear or see headlines about “the Dow was down X points” for quite some time to come.

New Yorkers

One wag’s definition of an expert is “someone in a suit from out of town.”

So it is that we quote Salomon Bros., the big New York brokerage, which has the added mystique of actually being on Wall Street.

In a recent investment advisory, the brothers at Salomon recommended lightening up on equities, to 40 percent of balanced portfolios, from 45 percent. Increase cash or cash equivalents to 25 percent. Keep 35 percent in bonds.

Salomon’s reasoning is some of that crazy stock market “good news is bad news” logic.

Evidently, the folks at Manpower Inc., the Milwaukee-based temp agency, surveyed clientele about their hiring plans for fourth quarter 1997, and found more people looking to hire than ever before.

That and other evidence have convinced the analysts at Salomon that the “domestic economy is on fire.”

Moreover, the dollar is as strong as it is going to get, meaning imports won’t get cheaper, reasoned Salomon.

All in all, the spectre of inflation and higher interest rates is real, according to Salomon and higher interest rates hurt stocks.

The numbers gnomes at Salomon also compute that with the yield on 10-year U.S. Treasury notes at 6.38 percent, the “appropriate multiple” for the S & P; 500 is 15.7 times next year’s earnings (the next reported four fiscal quarters).

Various tallies of expected profits of the companies on the S & P; 500 come to between $47.50 and $52.20, meaning the S & P; 500 index should be in the 745 to 820 level, said the brokerage.

By this standard, the S & P; 500 trading last week around 900 is about 15 percent to 20 percent overpriced, and ready for a correction, or cyclical bear market, said Salomon.

Web IPO?

Planning to get listed on the Nasdaq in “early 1998” is Malibu-based Kanakaris InterWorks Inc. The surfsiders “build storefronts on the Internet for any business.” In other words, they design Web sites.

The company’s clients include the FBI, AT & T;, Ford Motor Co. and Apple Computer Co., and it is in strategic alliances with Microsoft Inc. and America On-Line Inc. Kanakaris charges between $20,000 and $70,000 to make a site.

Westwood-based Alan Stone & Co. has been retained for investor relations, and investment banking firms are being interviewed for a potential initial public offering.

“We are interviewing investment bankers now, and we want to hire locally. I have been retained to help select a underwriter,” said Stone last week.

By the way, as part of his commission, Stone had Kanakaris build a Web site for him, at www. AlanStone.com. “It’s nicer than Merrill Lynch’s Web site,” said Stone last week.

Senior Reporter Benjamin Mark Cole covers the investment community for the Los Angeles Business Journal.

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