Here's Why Lululemon (LULU) Fell More Than Broader Market
The latest trading session saw Lululemon (LULU) ending at $446.06, denoting a -1.05% adjustment from its last day's close. The stock's performance was behind the S&P 500's daily loss of 1.02%. On the other hand, the Dow registered a loss of 1.04%, and the technology-centric Nasdaq decreased by 1.65%.
The athletic apparel maker's stock has dropped by 1.3% in the past month, falling short of the Consumer Discretionary sector's gain of 1.11% and the S&P 500's gain of 3.64%.
Analysts and investors alike will be keeping a close eye on the performance of Lululemon in its upcoming earnings disclosure. The company's upcoming EPS is projected at $4.99, signifying a 13.41% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $3.19 billion, up 15.04% from the year-ago period.
It's also important for investors to be aware of any recent modifications to analyst estimates for Lululemon. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.05% higher. Lululemon is currently a Zacks Rank #3 (Hold).
In terms of valuation, Lululemon is presently being traded at a Forward P/E ratio of 31.46. This denotes a premium relative to the industry's average Forward P/E of 13.85.
We can additionally observe that LULU currently boasts a PEG ratio of 1.57. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. As of the close of trade yesterday, the Textile - Apparel industry held an average PEG ratio of 1.57.
The Textile - Apparel industry is part of the Consumer Discretionary sector. At present, this industry carries a Zacks Industry Rank of 159, placing it within the bottom 37% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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lululemon athletica inc. (LULU) : Free Stock Analysis Report
