In the latest trading session, L Brands (LB) closed at $75.76, marking a +1.75% move from the previous day. This move outpaced the S&P 500's daily gain of 0.82%.
Prior to today's trading, shares of the owner of Victoria's Secret, Bath & Body Works and other chain stores had gained 7.77% over the past month. This has outpaced the Retail-Wholesale sector's gain of 0.05% and the S&P 500's gain of 3.89% in that time.
Wall Street will be looking for positivity from LB as it approaches its next earnings report date. This is expected to be August 18, 2021. In that report, analysts expect LB to post earnings of $1.29 per share. This would mark year-over-year growth of 416%. Our most recent consensus estimate is calling for quarterly revenue of $3.27 billion, up 41.09% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $6.21 per share and revenue of $14.55 billion, which would represent changes of +79.48% and +22.82%, respectively, from the prior year.
Any recent changes to analyst estimates for LB should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 5.87% higher within the past month. LB is currently a Zacks Rank #1 (Strong Buy).
Digging into valuation, LB currently has a Forward P/E ratio of 12. For comparison, its industry has an average Forward P/E of 16.26, which means LB is trading at a discount to the group.
Also, we should mention that LB has a PEG ratio of 0.92. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Apparel and Shoes was holding an average PEG ratio of 1.28 at yesterday's closing price.
The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 24, which puts it in the top 10% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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