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Shoe Carnival (SCVL) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
Methode (MEI) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.

Shoe Carnival (SCVL) closed at $36.95 in the latest trading session, marking a +0.71% move from the prior day. This change outpaced the S&P 500's 0.3% gain on the day. At the same time, the Dow added 0.46%, and the tech-heavy Nasdaq gained 0.08%.

Prior to today's trading, shares of the footwear retailer had lost 7.16% over the past month. This has lagged the Retail-Wholesale sector's gain of 3.97% and the S&P 500's gain of 5.93% in that time.

SCVL will be looking to display strength as it nears its next earnings release, which is expected to be March 28, 2019. On that day, SCVL is projected to report earnings of $0.06 per share, which would represent a year-over-year decline of 45.45%. Our most recent consensus estimate is calling for quarterly revenue of $232.50 million, down 4.41% from the year-ago period.

It is also important to note the recent changes to analyst estimates for SCVL. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. The Zacks Consensus EPS estimate has moved 1.52% higher within the past month. SCVL is currently a Zacks Rank #1 (Strong Buy).

Looking at its valuation, SCVL is holding a Forward P/E ratio of 13.74. Its industry sports an average Forward P/E of 12.94, so we one might conclude that SCVL is trading at a premium comparatively.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale 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 includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow SCVL in the coming trading sessions, be sure to utilize Zacks.com.


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