Lululemon (LULU) Gains But Lags Market: What You Should Know
Lululemon (LULU) closed the most recent trading day at $155.97, moving +0.48% from the previous trading session. This change lagged the S&P 500's 0.78% gain on the day. Meanwhile, the Dow gained 0.95%, and the Nasdaq, a tech-heavy index, added 0.98%.
Coming into today, shares of the athletic apparel maker had gained 14.56% in the past month. In that same time, the Consumer Discretionary sector gained 3.19%, while the S&P 500 gained 2.17%.
LULU will be looking to display strength as it nears its next earnings release, which is expected to be December 5, 2018. In that report, analysts expect LULU to post earnings of $0.68 per share. This would mark year-over-year growth of 21.43%. Meanwhile, our latest consensus estimate is calling for revenue of $731.91 million, up 18.24% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.52 per share and revenue of $3.23 billion. These totals would mark changes of +35.91% and +21.78%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for LULU. These revisions help to show the ever-changing nature of near-term business trends. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 10.46% higher. LULU is currently a Zacks Rank #1 (Strong Buy).
Digging into valuation, LULU currently has a Forward P/E ratio of 44.05. Its industry sports an average Forward P/E of 18.56, so we one might conclude that LULU is trading at a premium comparatively.
Also, we should mention that LULU has a PEG ratio of 2.35. 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. The Textile - Apparel industry currently had an average PEG ratio of 1.87 as of yesterday's close.
The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 30, which puts it in the top 12% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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