Lululemon (LULU) closed the most recent trading day at $344.32, moving +1.52% from the previous trading session. This change outpaced the S&P 500's 0.27% gain on the day. At the same time, the Dow added 1.31%, and the tech-heavy Nasdaq lost 0.39%.
Heading into today, shares of the athletic apparel maker had gained 8.54% over the past month, outpacing the Consumer Discretionary sector's gain of 7.94% and the S&P 500's gain of 6.66% in that time.
Investors will be hoping for strength from LULU as it approaches its next earnings release. The company is expected to report EPS of $0.49, down 48.96% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $821.74 million, down 6.98% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $4.37 per share and revenue of $4.04 billion, which would represent changes of -11.36% and +1.43%, respectively, from the prior year.
Any recent changes to analyst estimates for LULU should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
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. The Zacks Consensus EPS estimate remained stagnant within the past month. LULU currently has a Zacks Rank of #3 (Hold).
In terms of valuation, LULU is currently trading at a Forward P/E ratio of 78.36. This valuation marks a premium compared to its industry's average Forward P/E of 38.92.
Meanwhile, LULU's PEG ratio is currently 4.27. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Textile - Apparel was holding an average PEG ratio of 4.46 at yesterday's closing price.
The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 219, which puts it in the bottom 14% 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.
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