|Bid||0.00 x 900|
|Ask||0.00 x 800|
|Day's Range||45.58 - 48.00|
|52 Week Range||32.37 - 72.27|
|Beta (3Y Monthly)||2.95|
|PE Ratio (TTM)||67.83|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||32.90|
Welcome to the latest episode of the Full-Court Finance podcast from Zacks Investment Research where Associate Stock Strategist Ben Rains breaks down Nike's (NKE) Q3 fiscal 2019 financial results that led to a small selloff on the back of lower-than-expected sales in a key business. The episode then dives into what to expect from Lululemon's (LULU) Q4 earnings.
Lululemon (LULU) shares popped over 3% Thursday heading into the release of its fourth quarter financial results, as part of its larger 2019 climb. The yoga apparel and athleisure giant's bottom-line looks set to surge as it expands its menswear business, its global reach, and more.
Iconic denim brand Levi Strauss & Co. (NYSE:LEVI) has returned to the New York Stock Exchange and demand for Levi's initial public offering (IPO) is off the charts. After all, it's not often you get to buy into a 166-year-old company. Started by Levi Strauss and his customer Jacob Davis in 1873, the denim maker is taking a second crack at being a public company. The first time was in 1971. It lasted 14 years before descendants of the founder took the company private for $1.6 billion in 1985, at the time, the largest buyout of a publicly held U.S. firm. Flash forward to 2019, and it's ready for a second kick at the cat. InvestorPlace - Stock Market News, Stock Advice & Trading TipsI hadn't thought about writing about Levi's IPO, but then I got an email from Motif Investing offering IPO shares, and I just had to take a look at its prospectus. While I have total respect for the job CEO Chip Bergh has done turning the denim brand around, I've got my doubts about buying LEVI stock, which is bound to be popular. * 7 Beaten-Up Stocks to Buy as They Reverse Course Here's why: 7 Reasons to Steer Clear of the Levi IPO: It's Too PriceyAfter looking at Levi's prospectus, I concluded that its IPO is pricey from a valuation perspective. However, when I saw a MarketWatch article suggesting its stock is undervalued, I just had to understand the authors' rationale.Fundamentally, the authors believe that Levi's enterprise value as a multiple of invested capital at 2.7 times is low given its return on that invested capital over the past five years has never dropped below 14%.Furthermore, the authors conclude that Levi's fair value based on its discounted future cash flow is worth $19 a share or a market cap of $7.3 billion [based on 385.5 million shares outstanding after the IPO].I don't see things nearly as rosy. While you might think it makes sense to compare Levi's to other jean manufacturers and retailers, I'm going to compare it to Lululemon (NASDAQ:LULU), a brand that's still very much in growth mode, and an alternative you ought to consider before pulling the trigger on LEVI stock. In fiscal 2018, Levi's had adjusted EBITDA of $706.6 million. At the midpoint of its $14-$16 price range, Levi's is valued at 8.2 times its adjusted EBITDA [$5.78B divided by $706.6M]. In fiscal 2018, Lululemon's EBITDA was $564.2 million, which means its market cap of $19.3 billion is 34 times EBITDA. On the surface, it seems like a no-brainer in Levi's favor. However, you have to remember that LULU has grown revenues by 66% over the past four years compared to 17% for Levi's. Also, LULU's operating margin is 17%, 740 basis points higher than Levi's. As long as Lululemon continues to grow its men's, Asian and online businesses, it will continue to outperform Levi's.Do yourself a favor and compare Levi's to companies like VF (NYSE:VFC) and American Eagle Outfitters (NYSE:AEO) and you'll see that a valuation of $5.78 billion or more is quite high on a comparative basis. 7 Reasons to Steer Clear of the Levi IPO: Dual-Class Share StructureIf you want to own shares of Levi's be prepared for the Haas family to run the show because they control Levi's through the Class B shares. I'm of two minds when it comes to dual-class share structures. On the one hand, having a majority of the votes in the hands of long-term investors is a good thing. However, on the downside, is the fact that many of the large institutions that will be buying Levi's shares will have almost zero say in how the company is run. Oh, sure, in good times, who cares about corporate governance, but when Levi's falters, and it will because all companies go through difficult times, CEO Charles Bergh will have to convince not only the board but the entire Haas family of his plan to right the ship. * 7 Beaten-Up Stocks to Buy as They Reverse Course That's never an easy task. 7 Reasons to Steer Clear of the Levi IPO: Nothing But JeansWell, that's not entirely true. In recent years, Levi's has done an excellent job reducing its dependence on bottoms. In 2018, 74% of its revenue (both men and women) were from bottoms, 20% from tops, and 6% from footwear and accessories. Three years earlier, bottoms were 83% of its business, tops accounted for 11% of revenue and footwear and accessories the remaining 6%. However, its Levi's brand continues to be the dominant player, accounting for 86% of its overall figure, a number that's barely budged over the past four years. What's confusing about the prospectus is its interchangeable use of the words bottoms and pants. If I'm reading it correctly, pants, which accounted for 68% of overall revenue in 2018, are jeans and khakis, while the figure for bottoms includes pants as wells as skirts and shorts, which accounted for 6% of its overall revenue, flat to 2016.Also, its Dockers brand has slipped in importance, accounting for 7% of overall revenue in 2018, down from 10% in 2015. As denim goes, so goes Levi's. It wasn't too long ago that experts were calling for the demise of the blue jean. While I doubt that's ever going to come to pass, you never know if a new trend will arrive to supplant both denim and athleisure wear in the future. 7 Reasons to Steer Clear of the Levi IPO: Debt on Top of DebtAssuming Levi's goes out at a valuation of $5.78 billion, the company's long-term debt of $1.1 billion will be 19% of its market cap. That's not a massive amount by any means considering it's got more than $700 million on its balance sheet, but I can't help wonder why it hasn't paid down its debt over the past four years.Since fiscal 2014, Levi's paid off just $158 million of its long-term debt, which consists of $486 million in 5% senior notes due in May 2025 and $535 million of 3.375% senior notes due in March 2027. In addition, Levi's has paid out $300 million in dividends to shareholders (primarily the Haas family) over the past five years, not including the $110 million it will pay out in fiscal 2019The company expects to generate as much as $184 million in net proceeds from the sale of Class A shares other than those of the selling shareholders. None of which is earmarked for debt repayment. * 5 Stocks To Buy for the Happiest Employees That seems odd considering the high level of debt and cash. 7 Reasons to Steer Clear of the Levi IPO: Finding the Right BalanceIn the InvestorPlace stock-picking contest for 2019, I picked Canada Goose (NYSE:GOOS) because I believe it's developing a trifecta of growth -- wholesale, direct-to-consumer and online -- that will allow it to grow the top line by double-digits for the next few years without spending too much money on expensive store openings. By limiting the number of retail locations to 20-30 in some of the world's best cities, it provides the brand with a good advertising vehicle, while keeping the costs down. Levi's opened 74 stores in fiscal 2018 alone, including a 17,000 square-foot location in New York City's Times Square. That brings the company's retail footprint to 831 stores with another 500 shop-in-shops. When you consider that those retail stores along with its e-commerce sites accounted for just 35% its overall revenue in fiscal 2018 -- with an embarrassingly low 4% from e-commerce -- I have to wonder if it will ever find the right balance between the three revenue streams. In the last three years, Levi's capital expenditures have increased by 55% from $103 million in 2016 to $159 million in 2018. If it keeps opening 17,000 square-foot flagships, it's going to need a lot more than $159 million to get the job done. I'd watch spending if you do buy shares in the company. 7 Reasons to Steer Clear of the Levi IPO: Bergh's CompensationThere's no question that CEO Charles Bergh has done a good job turning around the brand. Last July, the Harvard Business Review published a good article about Bergh's transformation. If you're planning to invest, I recommend you read it. Of the four part's of Bergh's strategy, all of them are very much a work in progress. The one needing the most work is its goal to become a leading omnichannel retailer. In my books, you're not a successful omnichannel retailer unless you're generating at least 20% of your revenue online. In 2018 and 2017, Levi's e-commerce revenue accounted for just 4% of its overall revenue, well short of what's required for omnichannel excellence. For all Bergh's accomplished, he's still got a lot to prove in my opinion. Ultimately, has he done enough to justify three-year total compensation of $34.3 million, which doesn't include the $138 million worth of stock he'll own or have the right to acquire after Levi's IPO? * 5 of the Best Dow Jones Stocks to Buy for Solid Dividends If you buy Levi's shares, I guess you're going to find out. 7 Reasons to Steer Clear of the Levi IPO: Weak Asian BusinessOf all the negatives I've found about Levi's, the lack of success in Asia is the biggest surprise.In fiscal 2018, its Asian business contributed just 16% of Levi's overall revenue compared to 29% for Europe and 55% for the Americas. On a constant currency basis, its Asian business grew revenues by 8.2% in 2018, 180 basis points less than its growth in the Americas and less than half that of Europe. To catch up to Europe's overall revenue of $1.6 billion, Asia's got to double its sales to do so. True, you can look at it from the perspective that the best is yet to come, but given how competitive the Asian market is, I doubt that's going to happen anytime soon.Worse still, Asia's operating margin in 2018 was 9.8%, 830 and 800 basis points less than Europe and the Americas, respectively. Asia's got to hustle if Levi's hopes to get to $10 billion in sales by 2023. At the time of this writing, Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Specialty Retail ETFs to Buy the Industry's Disruption * 5 Stocks To Buy for the Happiest Employees * 3 Out-of-Favor Consumer Stocks to Buy Compare Brokers The post 7 Reasons to Steer Clear of the Levi IPO appeared first on InvestorPlace.
Ross Stores (ROST) is favored for its off-price model, price management, merchandise initiatives, and cost containment and store expansion plans. But a soft outlook for fiscal 2019 keeps us on the sidelines.
Foot Locker (FL) boasts a robust portfolio of leading brands under a variety of store banners that aids it to target specific markets and efficiently cater to consumer demand.
The industry line is simple: Drugs cost a lot to develop and overcharging consumers is the only way to recoup the upfront investment. Recently, both Pfizer (NYSE:PFE) and Eli Lilly (NYSE:LLY) have been in the news for price-related issues. Frankly, I'm tired of hearing the industry's bellyaching. It's a big reason I'm not a fan of Pfizer stock or most pharmaceutical companies for that matter. * 15 Stocks That May Be Hurt by This Year's Big IPOs If you've owned Pfizer stock over the past ten years, you've done OK, achieving an annualized total return of 15%. Eli Lilly's stock over the same period has an annualized total return of 17.42%. PFE stock underperformed the S&P 500 by 188 basis point on an annual basis, while LLY stock was 56 basis points higher than the indexAny time a stock delivers a double-digit return over a long period, you've done well. Good for you.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Lilly's Olive BranchThis week, Eli Lilly announced that it would introduce a generic version of its Humalog insulin injection medication at half the cost of the branded product. Same stuff. Lower price. What's not to like?That's how they want you to feel. The benevolent dictator. The problem is that it doesn't fix a fatally flawed healthcare system. It merely seeks to persuade healthcare reformists to tamp down their rhetoric so drug companies can continue to reap billions off the backs of hardworking Americans. You can fear socialism all you want, but when capitalism bankrupts people due to the high cost of drugs, you're backing the second-worst horse in a race that's likely not winnable. Senator Dick Durbin said it best when he tweeted that a half-price version of Humalog was still 73% cheaper in Canada. That's not an endorsement of Canada's healthcare system, which has its issues, but rather a severe condemnation of company's like Eli Lilly, who believe a half-priced version is part of the healthcare solution. That's like going to a retail store that's selling a product at 50% off, but still making a handsome gross profit. You walk away feeling good until you find out the product you paid $50 for actually cost $10 to produce. What's This Got to Do With Pfizer?Well, I happened to come across a CBC News piece from Feb. 15 entitled, Pfizer pushes up price of birth control used by low-income women, that highlights some price increases by the company for sexual health clinics in Southwestern Ontario. For example, its Allese and Minovral birth control pills were increased in price by 114% from CAD$7 to CAD$15 a month. Its Demulen and Synphasic birth control pills increased by 186% from CAD$7 to CAD$20 a month, and its Depo contraceptive injection increased by 40% from CAD$25 to CAD$35. The company argues that manufacturing costs have risen, necessitating the price increases.However, the price increases will hurt the people most vulnerable to this type of inflationary pressure. Those visiting the clinics are generally people who don't have a family doctor or a drug benefit plan, making the increase even harder to swallow."When these costs go up, absolutely we start to wonder whether people will be able to access these medications in the same way," said Middlesex-London Health Unit (MLHU) Associate Medical Officer of Health, Dr. Alex Summers.Situations like these demonstrate why there's a push in Canada to introduce universal pharmacare. "National pharmacare isn't just a conversation about high-cost, rare drugs needed in more extreme health conditions in our lives, but also part of our everyday preventive health," said Lauren Cipriano, assistant professor of health policy studies at the Ivey Business School. The Bottom Line on Pfizer StockWhile this particular scenario might not affect you, the fact that drug companies like Pfizer continue to initiate significant price increases without any apparent justification should concern you. So should the actions of Eli Lilly, whose recent sleight of hand might fool some of the people some of the time, but it won't fool all of them all of the time. I selected Canada Goose (NASDAQ:GOOS) as my best stock of 2019 for InvestorPlace's annual stock-picking contest despite not owning it personally. I won't, because I don't agree with its use of coyote fur on the hoods of its jackets. That's my personal choice. It doesn't have to be yours. * 7 Dividend Stocks to Buy Today The same goes for Pfizer, Eli Lilly, and the rest of the pharmaceutical companies. They're not my cup of tea, but for those who don't care about their pricing practices, they are very profitable. The choice is yours. As of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 15 Stocks Sitting on Huge Piles of Cash * The 10 Best Stocks to Buy for the Bull Market's Anniversary * 7 Dividend Stocks With Big Yields Compare Brokers The post The Case Against Pfizer Stock and the Rest of the Industry appeared first on InvestorPlace.
My InvestorPlace colleague Dana Blankenhorn recently wrote about the death of retail stocks. His conclusion was simple. Only those retailers who are saving people time and/or money will survive. End of story. Whether you're brick-and-mortar, online only, or omnichannel, consumers are no longer interested in a leisurely stroll at the mall. They want to get in and get out. Even better if they never have to step foot in one ever again. InvestorPlace - Stock Market News, Stock Advice & Trading TipsOf course, I'm simplifying Dana's conclusions. He does mention several old school retailers who're doing well including Kohl's (NYSE:KSS) and Target (NYSE:TGT), but if you work in retail and are looking for a happy ending, Dana's not the person to perk you up. I don't see retail in quite the same light. Sure, stores are still closing, but it's my belief that everything happens for a reason. In this case, retailers opened too many stores, and landlords willy-nilly took on their leases with no thought about the long-term health of their malls. * The 10 Best Stocks to Buy for the Bull Market's Anniversary Across the globe, there continue to be stories of retail stocks winning in 2019 and beyond. These are my best bets. Tractor Supply (TSCO)Any time I read a story about this Tennesse-based lifestyle retailer, I'm tickled pink. I haven't written about Tractor Supply (NASDAQ:TSCO) much in recent years -- I recommended TSCO stock in March 2015 shortly after it was added to the S&P 500 -- so when I saw Market Watch contributor Tonya Garcia's recent story about the company, I just had to put it on my list. As Garcia states, Tractor Supply serves consumers looking for the rural lifestyle. The weekend warrior if you will. "We sell everything else but the tractor. Anything for an authentic rural lifestyle," Mary Winn Pilkington, vice president of investor relations and PR at Tractor Supply, told Marketwatch. "We like to say that our team members not only know our customers names, we know their animals names."The beauty of Tractor Supply is that almost everything it sells you can buy elsewhere. However, by going to TSCO, you're avoiding multiple stops. That's one of its biggest advantages. The other is a loyalty program 11-million strong that generates half its annual revenue. Should the economy go in the tank, Tractor Supply is a retail stock that won't be nearly as vulnerable to shifting consumer sentiment. Lululemon (LULU)Although I didn't pick Lululemon (NASDAQ:LULU) in InvestorPlace's 10 Best Stocks for 2019 -- that honor goes to Canada Goose (NYSE:GOOS) which I discuss below -- I kind of wish I had. I got my wife a LULU gift card for our wedding anniversary in February. We recently stopped in at the only Lululemon store currently open in Halifax; it was packed on a Saturday afternoon. So busy, in fact, that we decided to leave because we couldn't any service. Now don't misinterpret what I'm saying. Would I have liked to have gotten better service? Sure. But if you know anyone who's worked in retail for a long time, sometimes a store gets so busy, service standards go out the window. I've been in plenty of LULU stores and know it generally brings good service to the table. I've been recommending LULU stock for a number of years because its apparel for both women and men is outstanding. So too are its same-store-sales growth and profit margins. It also doesn't hurt that analysts like it. "Lululemon has an enviable competitive position with a powerful combination of highly productive stores, aspirational proprietary product, a healthy e-commerce channel, and the potential to still more than double revenue as the concept continues to expand around the globe," analysts from William Blair wrote. * 7 Dark Horse Stocks That Deserve Your Attention in 2019 I couldn't agree more. Canada Goose (GOOS)Although I picked Canada Goose as the best stock for 2019, I personally wouldn't own it given I disagree with its treatment of coyotes and geese. Recently, Bill Maher, the host of HBO's hit show, Real Time, had some not-so-kind words for the company. "New rule: No more d**ches. I mean the hipster d**ches who piss away $1,000 on a Canada Goose parka and the hipsterazzi who max out their credit cards to look like them," Maher said. He went on to describe how coyotes and geese are mistreated in the name of commerce. To be fair, Canada Goose maintains that PETA misrepresents the truth and has for some time. Suffice to say, it's an ongoing debate. However, just because I disagree with the company's choice of materials, doesn't mean I can't defend its business model. From a purely business perspective, its sales growth, profit margins, and perfect balance between wholesale, brick-and-mortar, and e-commerce makes it a very competitive retailer. CEO Dani Reiss is a billionaire as a result of the company's success. If he and all of the other Canada Goose employees can sleep at night, who am I to doubt the veracity of its claims. Best Buy (BBY)MarketWatch contributor Jeff Reeves recently published an article that counters the idea that brick-and-mortar retail is dead. Best Buy (NYSE:BBY) and the next two stocks that follow are three of Jeff's ideas that I also believe make sense. The Best Buy of today is nothing like the struggling electronics retailer CEO Hubert Joly took over in 2012. In six years, it's figured out how to utilize its overly large real estate footprint, to battle Amazon (NASDAQ:BBY) in the e-commerce arena, something no one could have imagined it could do when Joly came on board. It's one of the biggest success stories in 21st century retail. On February 27, Best Buy announced adjusted earnings per share in the fourth quarter of $2.72, 16 cents higher than the consensus estimate. Equally as impressive, analysts expected same-store-sales growth of 1.8% in the quarter. It delivered 3%, well ahead of expectations. To celebrate the solid year, Best Buy also announced it was increasing its quarterly dividend by 11% to $0.50 a share. Paying $2 on an annual basis, BBY stock yields a healthy 3.0%. In fiscal 2020, Best Buy expects earnings per share as high as $5.65 a share, 6% higher than the past year. * 7 Top Stocks to Buy From Goldman Sachs' Secret Portfolio As long as Joly is in the top job, all is well at Best Buy. Bed, Bath & Beyond (BBBY)Although Best Buy and Bed, Bath & Beyond's (NASDAQ:BBBY) stock tickers are very similar, the state of their businesses, not to mention their respective valuations, are entirely different. As Reeves suggested, BBBY is a value play, trading at 8.5x forward earnings and 0.2 times sales. By comparison, BBY is trading at 12.1x forward earnings and 0.4 times sales. That's a big difference when you consider that its stock is up 35% year to date through March 7.Before we get too excited, it's important to remember that Bed, Bath & Beyond's business has been in decline for a couple of years. A better-than-expected Q3 2018 report in January helps, but when you've been experiencing declining same-store sales for several quarters, that's not going to get BBBY's stock price back into the $80s where it traded in 2015. On the plus side, BBBY finished the third quarter with $1 billion in cash and short-term investments, double the amount a year earlier. In the first nine months of 2018, Bed, Bath & Beyond's free cash flow was $408 million, 79% higher than in the same period last year. I could think of worse things to do than getting paid $0.64 annually in dividends (4.1% yield) while you wait for BBBY stock to revert to its historical norms. It's not a slam dunk mind you, but if you're a value investor, it's still reasonably cheap. Five Below (FIVE)After three consecutive years with annual total returns of 20% or more, discount retailer Five Below (NASDAQ:FIVE) appears to be taking a breather so far in 2019. I first jumped on the Five Below bandwagon in April 2017 arguing that its $5 or less concept was very attractive to teens and pre-teen customers. As a result, it would deliver strong returns for shareholders over the next decade. I still feel this way. On March 7, Oppenheimer initiated coverage of the company with an "outperform" rating. "It operates a unique and defensible small-store format and enjoys significant opportunity for further, outsized unit expansion, for the foreseeable future," Oppenheimer analysts stated in a note to clients. "Improving brand recognition and a superior merchandising acumen position FIVE to capture share as other, less well-positioned operators falter… In our view, investors are apt to continue to pay up for industry-leading sales and EPS growth prospects…" * 15 Growth Stocks to Buy Under 15x Earnings Oh, and case you're wondering about the quality of management, CEO Joel Anderson used to be the CEO of Walmart's (NYSE:WMT) online division before joining Five Below in 2014. LVMH (LVMUY)Unless you live in Europe, you might not have heard of Bernard Arnault, CEO of LVMH (OTCMKTS:LVMUY), the company behind Christian Dior, Louis Vuitton, Glenmorangie, Veuve Clicquot, Guerlain, TAG Heuer, DFS, and Sephora. On March 7, Arnault moved into third place on the Bloomberg Billionaires Index with a net worth of $83.1 billion, surpassing Warren Buffett.Arnault got started in luxury goods in 1984, buying the bankrupt company that owned Christian Dior. Selling all of that company's assets (except for Dior), he piled that money into buying a majority stake in LVMH. The rest is history. In February, rumors started to circulate that LVMH was interested in acquiring Pernod Ricard (OTCMKTS:PDRDY), the French-based spirits company, whose brands include Chivas Regal, Absolute, Havana Club, and Jameson. While the Pernod-Ricard brands aren't nearly as high end as LVMH's, a possible deal in partnership with Diageo (NYSE:DEO) could allow it to buy back the 34% Diageo holds in LVMH's drinks business.With LVMH and Five Below in your portfolio, you'll cover the entire spectrum of consumer taste. As of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 15 Growth Stocks to Buy Under 15x Earnings * 7 Dark Horse Stocks That Deserve Your Attention in 2019 * 5 Disruptive Technologies That Are Moving Too Fast Compare Brokers The post 7 Retail Stocks Winning in 2019 and Beyond appeared first on InvestorPlace.
Abercrombie (ANF) has more upside potential, driven by capital initiatives, cost savings and strong outlook. Digital growth, strength in Hollister and store fleet optimization further support growth.
Tech Data's (TECD) fourth-quarter fiscal 2019 earnings surpassed the Zacks Consensus Estimate, while sales missed the same. Also, management issued view for first-quarter fiscal 2020.
The December retail sales report caused a shock wave in the retail sector. Most retail stocks fell on the headline regardless of individual fundamentals. But now some traders and investors are starting to question their choices. And this questioning has created a few promising opportunities in the retail sector.We are in an age where information is instantaneous, so when headlines come out, everyone trades the same headline and at the same time. Add to this that machines now control a lot of trading money and this makes for a recipe where the headline effect is now more visible than ever.Since the sales report came out, we have received other reports where the numbers conflict with the initial disaster message. This tells me that the December sales report may have been a fluke. This is especially likely since it covered the period when we had the longest government shutdown in history.InvestorPlace - Stock Market News, Stock Advice & Trading TipsYesterday, we saw big rallies in Kohl's (NYSE:KSS) and Target (NYSE:TGT). They both reported earnings and beat expectations. They also guided well going forward. There were no specific alarms from the December sales period. So for now, I assume that the December retail report was a false tell, and that makes now the perfect time to capitalize on its effects. * 10 Hot Stocks to Buy Right Now With all of that said, here are three retail stocks that have a bright future regardless of general data. Canada Goose (GOOS)Canada Goose (NYSE:GOOS) just reported earnings, and the knee jerk reaction was to spike GOOS stock down 15% on the scorecard headline.But part of this drop was thanks to the unlucky timing of the report. GOOS earnings came in right around the release of the December retail report, which was the worst since 2009.At the time, I pounced on it and sold puts into the fear to go long the stock and made money almost instantly.I believe that the opportunity is still here.It's not like they delivered a bad report … just the opposite, in fact. GOOS beat on all metrics and they raised forward guidance significantly. So the company over-delivered and still said they'd even do better next time, yet traders sold it? This is the definition of an opportunity. Luckily, GOOS stock is still low enough that I'd still go long. If the stock markets are higher, GOOS will definitely be higher in the future.Furthermore, Canada Goose's clientele seems loyal and that is hard to short. I chose this stock specifically because it was punished by mistake over a "fake news" retail report.The next two retail stocks I chose for the exact opposite reason: They both held strong through the same unjustified retail fears. Yeti (YETI)Similar to GOOS, Yeti (NYSE:YETI) also has a strong following. Its clientele are cult-like, so on any weakness, I go long.The problem is that this stock hardly shows any. It's a momentum stock so it always looks like it's about to correct. YETI stock is up 65% year-to-date, so it left a lot of weak points behind it. This means investors might want to wait out a few ticks to see if the bears want to fill the gap below, near the $20 per share level.Or investors can just sell a long dated put below it. This allows you to go long immediately and if it falls below the strike, then you get to own YETI stock for a huge discount. For example, you can collect $1.20 per contract for selling the Aug $17.50 put. The breakeven point for this would be $16.30. * 7 Stocks Under $10 You Shouldn't Buy By selling the put, you commit to owning the shares, so only do this if you are able to buy them. Otherwise, there would be margin calls against your account. Tencent Music Entertainment Group (TME)Tencent (TCEHY) recently spun off its music streaming company into Tencent Music Entertainment Group (NYSE:TME). TME -- also referred to as the Spotify (NYSE:SPOT) of China -- is a sure winner among most other retail stocks.The general stability of its base business model means the company has room to execute on plans for whatever else it wants. The new model for success is now service based. Even giants like Microsoft (NASDAQ:MSFT) learned this new trick and they are now embracing subscriptions more than one-time sales.TME has been on a tear perhaps riding the wave of a U.S.-China deal as both markets continue to rally. It's up 40% YTD, which is pretty much its entire life as a public stock. I was lucky enough to bet on it early last year, but I still think TME stock is one to hold for a long while. It has a great model in a massive market and it has the support of a giant company behind it, so that is a recipe for long-term success.Fundamentally it's not cheap, but it is definitely not bloated. It sells at a high price-to-earnings ratio (56), which is high if you compare it to a company like Apple (NASDAQ:AAPL). But TME stock is in a completely different stage of life.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. You can follow him as @racernic on Twitter and Stocktwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 9 Blue-Chip Stocks That Will Lose You Money * 7 Cheap Stocks Under $5 That Could Soar * 7 Stocks Under $10 You Shouldn't Buy Compare Brokers The post 3 Retail Stocks That Are Sure Winners appeared first on InvestorPlace.
NEW YORK, Feb. 28, 2019 -- In new independent research reports released early this morning, Market Source Research released its latest key findings for all current investors,.
Canada Goose, Fossil, Ready Capital, Exantas Capital and Chatham Lodging Trust highlighted as Zacks Bull and Bear of the Day
Welcome to the latest episode of the Full-Court Finance podcast from Zacks Investment Research where Associate Stock Strategist Ben Rains breaks down three of the best sportswear-focused stocks to consider buying right now.
The market has been in full-on rebound mode ever since the Federal Reserve backed down from its aggressive rate-hiking ways in December. It helps that the trade talks between the U.S. and China are reportedly going well. That has left a whole host of industries and sectors trading higher, consumer stocks included.At the end of the day, the economy is built around the consumer. Consumers buy food, clothes, electronics, houses, vehicles and a whole lot more. To buy these products -- some luxuries, some necessities -- these consumers go to work, creating productivity (and ultimately profit) for companies and corporations. Those corporations built products for some companies and pay for services from others. It's an endless loop of commerce plowing dollars all around the world. * 10 Blue-Chip Stocks to Lead the Market Because the economy continues to do well and the labor market is so strong, consumer spending remains strong too. As such, a number of consumer stocks are doing quite well at the moment. Let's take a look at the ones that are outperforming and see how their stocks are trading as a result.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Consumer Stocks to Buy: Starbucks (SBUX)There were a few years where Starbucks (NASDAQ:SBUX) was becoming a difficult investment to own. Same-store sales results were so-so, management kept snipping (although not slashing) their outlook and its stock price was stuck in a major rut.The only thing that kept me really invested in this name was the company's ability to still generate record earnings and revenue each quarter, raise its dividend by double-digit percentage points and maintain very healthy cash flow. Ultimately, Starbucks' valuation was the culprit, as a lower valuation was required for its lower rate of growth.It took a few years of sideways action for that equilibrium to be achieved, but it finally happened. After plunging last summer, SBUX has been on fire. Shares have soared from $47 to more than $71, as the stock price hovers just below all-time highs and is firmly in breakout territory.Analysts call for 6.4% sales growth this year and 7.8% in fiscal 2020. That goes alongside 11.6% earnings growth this year and 12.2% growth next year. Starbucks has built a successful cash cow in the U.S. and will rely on China for its future growth. So much so that the company is building roughly 500 locations a year in the country. While trade talks have been on the rocks (although improving), Starbucks hasn't seen much of a hiccup in its long-term plans and that should comfort long-term investors. Chipotle (CMG)Chipotle Mexican Grill (NYSE:CMG) is back and business is boomin'. CEO Brian Niccol took over the reins less than a year ago, but he's implementing the right growth measures he learned while he was at Yum! Brands (NYSE:YUM) and Taco Bell.Consumers are finally done talking about norovirus and the other food-borne issues that plagued Chipotle in years' past. Of course, the company is one breakout from jeopardizing all of its hard work to recover customer trust, but it's clear sailing otherwise.The company hammered fourth-quarter earnings expectations, and should it maintain momentum, CMG is setting up for a big 2019. Analysts expect just 8.8% revenue growth this year, but are calling for a big boost in margin expansion with 35.7% earnings growth. Sheesh! Even better though, estimates for 2020 are similar, at 10.2% and 26.2%, respectively. * 7 Cheap Stocks That Make the Grade Again, short of CMG going through another outbreak, its growth profile and profitability are set to expand dramatically. This will boost the company's free cash flow, allowing for faster expansion and growth. Finally, the company doesn't carry any long-term debt on its balance sheet. Home Depot (HD)When the economy is going strong, the housing market usually is too. When that's the case, Home Depot (NYSE:HD) is a big winner.The home improvement retailer benefits from a strong housing market, as well as a stable one. Not only does a new kitchen or bathroom improve living quality and happiness, but it also increases home value. Why someone upgrades their bathroom or kitchen varies -- renovating for themselves, prepping to sell, flipping a house, etc. -- but the reason doesn't really matter. At least, it doesn't matter to Home Depot.What matters is that consumers are renovating and if the company's past results are any indication, consumers are doing plenty of it. Home Depot easily beat expectations in November, and while it missed on Q4 numbers this week, those numbers still showed plenty of growth.Also, while many do-it-yourselfers likely received new drills and table saws over the holidays, many gift purchases came from other industries. Interest rates also increased in December and while the Fed is clearly on hold now, the housing market has been bumpy over the past few months, likely as a result. That could give us a great short-term opportunity in HD on this post-earnings dip.Ultimately, the spring season is like the company's holiday period, making the short-term pullback even more attractive. Consumers will be out working on their yard, doing spring clean-ups and embarking on new household projects.The bottom line on HD is simple: While the economy and labor markets are strong, Home Depot's business should be too. Nike (NKE)Almost too ironically, Nike (NYSE:NKE) suffered a shoe gaff right as the stock was trading up to its prior highs. When Zion Williamson, a star player at Duke, saw his shoe literally blow out from under him just seconds into a game against North Carolina, Nike stock took a tumble.If we get more of a tumble from this singular incident, it could lead to an excellent buying opportunity.Like Starbucks, Nike's double-digit earnings growth, high-single-digit revenue growth and double-digit annual dividend growth makes it a Future Blue Chip holding for us. Given the current outlook, we feel confident that Nike will continue its growing ways. Analysts expects 11.3% and 18% earnings growth this year and next, alongside roughly 7.8% revenue growth in both years. * 9 High-Growth Stocks to Buy Now for Monster Returns Margins continue to expand as Nike continues to grow its direct-to-consumer business. As it relies less on middlemen to sell its products, Nike should continue to benefit from this concept for years to come. Canada Goose (GOOS)In our daily Top Stocks to Trade column, I was flabbergasted with the post-earnings reaction in Canada Goose (NYSE:GOOS). Get a load of these numbers and explain why it was justified for GOOS stock to fall almost 17% in a single session:Revenue of about C$400 million, up more than 50% year-over-year and more than C$132 million ahead of estimates -- a beat of almost 50%! -- and GAAP earnings of 93 cents per share Canadian, 32 cents or 52.5% ahead of expectations. But wait, there's more. Management guided for a strong fiscal 2019, calling for mid-to-high 30% revenue growth and mid-to-high 40% earnings growth. Analysts were looking for "just" 21% and 23% growth, respectively.When GOOS crushed estimates last quarter and then provides this strong of an outlook, the share prices deserves to go higher, not lower. It's no wonder the stock has recovered some of its post-earnings losses, but this high-octane name can go higher if it continues to deliver. Lululemon Athletica (LULU)Shares of Lululemon Athletica (NYSE:LULU) continue to grind higher, as LULU has now strung together eight consecutive earnings and revenue beats. When reporting its Q3 results back in December, sales grew more than 20% year-over-year. But in January, we got another update on the business.Management said that holiday sales were strong, with Q4 comp-store sales growing in the mid-to-high teens. Guidance for the quarter also came in ahead of expectations. Lululemon won't report for about another month, but there is still plenty to like about the name, particularly as growth is above consensus expectations.Analysts expect Lululemon to end the year with 23.4% revenue growth and follow it up with almost 14% growth in the next year. Momentum is going strong -- as evidenced by Nike and Under Armour (NYSE:UAA) as well -- and that bodes well for Lululemon's business going forward.On the earnings front, estimates call for roughly 45% growth this year and 17% growth in fiscal 2020 (next year). Admittedly, this does leave LULU stock trading at about 40 times this year's earnings. That's expensive and not unlike CMG. But if these stocks continue to push higher and can maintain their current trajectory, the share prices will push higher too. * 7 Healthy Dividend Stocks to Buy for Extra Stability We could see a scenario where LULU stock follows its range higher (black lines) and also challenges its 52-week highs near $165. Target (TGT)Investors have been leery to put money to work in physical retailers, but Target (NYSE:TGT) should be an exception here. The stock has a low valuation, good yield and solid growth. Plus, it's one of the few big names that are able to holds its own against larger players like Amazon (NASDAQ:AMZN) and Walmart (NYSE:WMT).Target's e-commerce initiatives have been paying off, while its brick-and-mortar remodels have helped drive traffic through its doors. As such, the company is looking at growing earnings 14.6% to $5.40 per share this year. Should it achieve in-line results, that values Target stock at just 13.5 times earnings.Admittedly, growth is forecast to taper off a bit, down to just 4.1% earnings growth next year. But the company's revenue profile -- 4.9% growth this year, 3.1% next year -- is solid and guidance could always come in ahead of expectations. After all, momentum is strong right now, as recently proven by Walmart's quarterly results.Throw in a 3.5% dividend yield and Target looks worthy of consideration.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long SBUX and AMZN. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Strong Buy Stocks Top Investors Are Buying Now * 7 Cheap Stocks That Make the Grade * 5 Clinical-Stage Biotech Stocks to Buy Compare Brokers The post 7 Consumer Stocks to Buy and Hold for Years appeared first on InvestorPlace.
If you are looking for a fast growing stock that is still seeing plenty of opportunities on the horizon, make sure to consider Canada Goose (GOOS).
First, let's address the big thing we've all noticed in Weight Watchers International (NASDAQ:WTW) and that's the stock has been a huge dud. WTW stock is down roughly 60% over the past 12 months and has been trapped in a massive downtrend. Why would anyone want to enter this name ahead of earnings, scheduled for tomorrow, February 26, after the close?Source: Shutterstock Well, there are actually a few decent recents to consider owning WTW stock. When the calendar flips to a new year, people turn to making resolutions. "New year, new me," they say. For many, that means dieting and exercise, which means more money for Weight Watchers. As we push into the summer season, beach-bod goals have more customers jumping into a Weight Watchers plan. * 5 Dow Jones Stocks That Will Lead the Market Higher Put simply, while Weight Watchers stock may not enjoy fiscal Q4 as much as many other companies -- say like a Canada Goose (NYSE:GOOS) or Hasbro (NYSE:HAS) -- it has six solid months of business coming. Fiscal Q1 and Q2 are the company's two strongest quarters. But if guidance is weak, investors will ignore that catalyst. They need a strong outlook from management to get this stock flying.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Valuing Weight Watchers StockIt's hard to be overly bearish on a stock that's already down 60% over the past year. Further, it's hard to be bearish on that stock when it's expected to earn $2.86 per share for fiscal 2018. Not only is that up almost 75% from fiscal 2017 (assuming WTW can deliver in-line or better Q4 results), but it also values WTW stock at just 10.3x earnings.Revenue is set to grow more than 17% in fiscal 2018 and analysts see even more growth ahead. Growth estimates for 2019 stand at 8.2%, with earnings forecast to grow another 20% to $3.43 per share. Again, it's important that Weight Watchers is able to deliver a solid outlook, giving investors a reason to bid this name higher.We need to see strong subscriber growth and know that business is holding steady. While Q3 wasn't a bad quarter, the company did miss on earnings and revenue expectations. Interestingly enough though, management raised its full-year outlook in the quarter, so it's surprising that investors didn't cut WTW a little slack. Either way, it doesn't matter. We need a solid quarter and outlook to get the bulls back on board.Analysts are looking for 60 cents per share in Q4, down from the 63 cents per share they were looking for 90 days ago. On the revenue front, Estimates call for ~$347 million in sales. As we saw in Q3, the results do matter, even if the outlook is strong.On the balance sheet front, WTW would be more attractive if the company didn't carry $1.6 billion in long-term debt, although that is down more than 25% from fiscal year-end 2015. Remember, this is a ~$2 billion market cap company, so its balance sheet is somewhat less than ideal. Trading WTW StockDespite some of the seemingly positive developments at Weight Watchers, we have one true guide: price.Simply put, it's been a rough ride for WTW stock. However, shares are oversold and momentum is seemingly bottoming out, as indicated by the blue circles on the RSI and MACD measurements. Weight Watchers stock also has a 17% short interest. * 7 Cheap Stocks That Make the Grade On the weekly chart, as shown above, the 10-week moving average continues to pressure the share price lower. It is now below the 200-week moving average as well. If we get a positive reaction to earnings, I need to see a close over the 10-week moving average near $33.80. Should we get it, then it can kickstart a larger rally, perhaps up to $40, where a prior downtrend line current resides. Should WTW stock react negatively to earnings, look to see that the bottom of downtrend support holds, currently near $25.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Monthly Dividend Stocks to Buy to Pay the Bills * 9 High-Growth Stocks to Buy Now for Monster Returns * 7 Healthy Dividend Stocks to Buy for Extra Stability Compare Brokers The post Should You Buy Weight Watchers Stock Ahead of Earnings? appeared first on InvestorPlace.