Lululemon (LULU) closed at $172.99 in the latest trading session, marking a +1.71% move from the prior day. The stock fell short of the S&P 500, which registered a gain of 2.05% for the day. Meanwhile, the Dow gained 2.54%, and the Nasdaq, a tech-heavy index, added 2.27%.
Prior to today's trading, shares of the athletic apparel maker had lost 19.83% lagged the Consumer Discretionary sector's loss of 5.61% and the S&P 500's loss of 1.49%.
Market participants will be closely following the financial results of Lululemon in its upcoming release. In that report, analysts expect Lululemon to post earnings of $4.74 per share. This would mark a year-over-year decline of 22.8%. At the same time, our most recent consensus estimate is projecting a revenue of $3.6 billion, reflecting a 0.24% fall from the equivalent quarter last year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $13.06 per share and a revenue of $11.08 billion, representing changes of -10.79% and +4.61%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Lululemon. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational 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. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.24% lower. As of now, Lululemon holds a Zacks Rank of #3 (Hold).
Looking at valuation, Lululemon is presently trading at a Forward P/E ratio of 13.33. Its industry sports an average Forward P/E of 18.53, so one might conclude that Lululemon is trading at a discount comparatively.
We can also see that LULU currently has a PEG ratio of 10.75. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. By the end of yesterday's trading, the Textile - Apparel industry had an average PEG ratio of 2.15.
The Textile - Apparel industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 70, which puts it in the top 29% of all 250+ industries.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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lululemon athletica inc. (LULU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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