Lululemon (LULU) closed at $378.08 in the latest trading session, marking a +1.38% move from the prior day. This change lagged the S&P 500's 1.96% gain on the day. Meanwhile, the Dow gained 1.57%, and the Nasdaq, a tech-heavy index, lost 3.03%.
Heading into today, shares of the athletic apparel maker had gained 3.3% over the past month, outpacing the Consumer Discretionary sector's gain of 1.35% and the S&P 500's gain of 2.19% in that time.
Investors will be hoping for strength from Lululemon as it approaches its next earnings release. On that day, Lululemon is projected to report earnings of $1.93 per share, which would represent year-over-year growth of 30.41%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.93 billion, up 19.48% from the year-ago period.
LULU's full-year Zacks Consensus Estimates are calling for earnings of $11.47 per share and revenue of $9.38 billion. These results would represent year-over-year changes of +13.9% and +15.66%, respectively.
Any recent changes to analyst estimates for Lululemon should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-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. 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. Within the past 30 days, our consensus EPS projection has moved 2.06% higher. Lululemon currently has a Zacks Rank of #3 (Hold).
Looking at its valuation, Lululemon is holding a Forward P/E ratio of 32.52. For comparison, its industry has an average Forward P/E of 12.11, which means Lululemon is trading at a premium to the group.
Also, we should mention that LULU has a PEG ratio of 1.63. 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 Textile - Apparel industry currently had an average PEG ratio of 1.22 as of yesterday's close.
The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 157, which puts it in the bottom 38% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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