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XCel Brands (XELB) Gains But Lags Market: What You Should Know

Zacks Equity Research

XCel Brands (XELB) closed at $2.11 in the latest trading session, marking a +0.48% move from the prior day. The stock lagged the S&P 500's daily gain of 0.69%. Elsewhere, the Dow gained 0.65%, while the tech-heavy Nasdaq added 0.58%.

Coming into today, shares of the brand management company had gained 61.54% in the past month. In that same time, the Retail-Wholesale sector gained 2.38%, while the S&P 500 gained 1.36%.

Investors will be hoping for strength from XELB as it approaches its next earnings release. On that day, XELB is projected to report earnings of $0.06 per share, which would represent a year-over-year decline of 25%. Our most recent consensus estimate is calling for quarterly revenue of $10.20 million, up 23.49% from the year-ago period.

XELB's full-year Zacks Consensus Estimates are calling for earnings of $0.40 per share and revenue of $45.10 million. These results would represent year-over-year changes of +33.33% and +27.99%, respectively.

Any recent changes to analyst estimates for XELB 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.

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 remained stagnant. XELB is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note XELB's current valuation metrics, including its Forward P/E ratio of 5.25. This valuation marks a discount compared to its industry's average Forward P/E of 11.26.

Also, we should mention that XELB has a PEG ratio of 0.52. 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 Retail - Apparel and Shoes industry currently had an average PEG ratio of 1.25 as of yesterday's close.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 79, putting it in the top 31% 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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