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Stitch Fix (SFIX) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Stitch Fix (SFIX) closed at $18.67 in the latest trading session, marking a -0.32% move from the prior day. This change lagged the S&P 500's daily loss of 0.24%. At the same time, the Dow lost 0.3%, and the tech-heavy Nasdaq lost 0.58%.

Coming into today, shares of the online clothing styling service had lost 2.8% in the past month. In that same time, the Retail-Wholesale sector gained 3.75%, while the S&P 500 gained 4.96%.

SFIX will be looking to display strength as it nears its next earnings release, which is expected to be October 1, 2019. In that report, analysts expect SFIX to post earnings of $0.04 per share. This would mark a year-over-year decline of 76.47%. Meanwhile, our latest consensus estimate is calling for revenue of $432.10 million, up 35.75% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for SFIX. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SFIX is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, SFIX is holding a Forward P/E ratio of 69.74. This represents a premium compared to its industry's average Forward P/E of 11.24.

Investors should also note that SFIX has a PEG ratio of 2.32 right now. 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. SFIX's industry had an average PEG ratio of 1.28 as of yesterday's close.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 51, which puts it in the top 20% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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