In the latest close session, Lululemon (LULU) was down 2.8% at $113.37. This move lagged the S&P 500's daily loss of 0.14%. On the other hand, the Dow registered a loss of 0.01%, and the technology-centric Nasdaq decreased by 0.57%.
The athletic apparel maker's shares have seen an increase of 7.08% over the last month, surpassing the Consumer Discretionary sector's loss of 2.38% and the S&P 500's gain of 0.25%.
Analysts and investors alike will be keeping a close eye on the performance of Lululemon in its upcoming earnings disclosure. The company is forecasted to report an EPS of $1.79, showcasing a 42.26% downward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $2.47 billion, down 2.26% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $10.94 per share and revenue of $11.08 billion, which would represent changes of -17.5% and -0.22%, respectively, from the prior year.
Any recent changes to analyst estimates for Lululemon should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 1.77% lower. Lululemon currently has a Zacks Rank of #5 (Strong Sell).
Looking at its valuation, Lululemon is holding a Forward P/E ratio of 10.66. This denotes a discount relative to the industry average Forward P/E of 16.34.
It's also important to note that LULU currently trades at a PEG ratio of 3.82. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Textile - Apparel was holding an average PEG ratio of 2.28 at yesterday's closing price.
The Textile - Apparel industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 172, putting it in the bottom 31% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.
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lululemon athletica inc. (LULU): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).