Lululemon (LULU) closed at $238.56 in the latest trading session, marking a -0.1% move from the prior day. This change was narrower than the S&P 500's 0.38% loss on the day. Meanwhile, the Dow lost 0.46%, and the Nasdaq, a tech-heavy index, added 0.17%.
Coming into today, shares of the athletic apparel maker had lost 0.23% in the past month. In that same time, the Consumer Discretionary sector lost 6.46%, while the S&P 500 lost 4.88%.
Investors will be hoping for strength from LULU as it approaches its next earnings release. The company is expected to report EPS of $2.25, up 21.62% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.38 billion, up 18.39% from the prior-year quarter.
Any recent changes to analyst estimates for LULU should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.37% higher. LULU is holding a Zacks Rank of #2 (Buy) right now.
Valuation is also important, so investors should note that LULU has a Forward P/E ratio of 41.39 right now. Its industry sports an average Forward P/E of 12.93, so we one might conclude that LULU is trading at a premium comparatively.
It is also worth noting that LULU currently has a PEG ratio of 2.2. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. LULU's industry had an average PEG ratio of 2.05 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 160, which puts it in the bottom 38% 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.
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