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The Zacks Analyst Blog Highlights Builders FirstSource, Carter's and Target
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For Immediate Release
Chicago, IL – March 22, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Builders FirstSource (BLDR - Free Report) , Carter’s Inc. (CRI - Free Report) and Target (TGT - Free Report) .
Here are highlights from Monday’s Analyst Blog:
Capitalize on Market Trends with These 3 Retail Stocks
Riding on the tails of last Wednesday's meeting with the Fed, the major indices turned in their best weekly performances since last November and provided investors with a much-needed relief rally.
Investors are hopeful that the rally will last and the market can continue its ascent as the outlook for economic growth strengthens. COVID-19 seems to be retreating, there is a ton of pent-up economic demand, and the Fed's plans have become clearer. With a more robust economic outlook, I believe that retail names stand to benefit.
To capitalize on the market's strength, it's essential to pivot to names that have a strong Zacks Rank paired with a high VGM Score. Let's look at three retail stocks that meet these criteria and analyze why they would be good additions to your portfolio amid a rebounding market.
Builders FirstSource
Builders FirstSource is a leading supplier and manufacturer of structural building products. Shares of the company have been notably strong over the last year, increasing 60% in value and easily outpacing the S&P 500's return of 15%. Year-to-date, BLDR shares haven't been as strong, declining 11% and lagging behind the general market.
BLDR's future growth outlook is impressive due to its high number (16) of upwards estimate revisions over the last 60 days. Current quarter estimates have increased nearly 85% to $2.08 per share, and for the following quarter, estimates have increased 60% to $2.54 per share. Additionally, the consensus estimate trend has increased by 30% to $8.91 per share for the current year, and for the following year, it has increased 33% to $9.23 per share.
Earnings reports for BLDR have been the definition of consistency, chaining together 14 straight EPS beats dating back to August 2018. The average EPS surprise over the last four quarters is nearly 75%, and in its most recent quarter, the company exceeded expectations by 47%, or $0.89.
BLDR is optimistic about notable improvement within its financial performance, expecting net sales in the range of $19.3 billion - $19.8 billion versus the previously expected $18 billion - $19 billion. The company's 8.8X forward earnings multiple is also much lower than the Zacks Building Products – Retail Industry's average of 16.3X.
The consensus estimate trend for BLDR has been rapidly increasing, earnings reports have consistently beat expectations, and the company's forward earnings multiple is notably lower than the industry average. Additionally, its Zacks Rank #1 (Strong Buy) and its VGM Score of an A reinforce my belief that BLDR would be a great addition to your portfolio amid a rebounding market.
Carter's is the largest marketer of branded apparel and related products for babies and young children in North America. Shares of the company have lagged behind the general market over the last year, increasing nearly 10% in value. Year-to-date, shares have provided slightly better defense than the S&P 500, decreasing 5% in value.
Out of ten analyst estimate revisions over the last 60 days, eight have been upwards. The next quarter has endured two downwards revisions, causing the consensus estimate trend to decrease 22% to $1.33 per share, and the trend for the following quarter has increased 20% to $1.89 per share. Additionally, the trend has increased by 10% to $8.93 per share for the current year and 12% to $9.71 per share for next year.
Carter's has beaten EPS estimates in each of its last four quarterly reports, providing an average EPS surprise of nearly 200%. Two of the previous four quarterly reports etched in triple-digit surprises, and its most recent quarter beat expectations by 13%, reporting EPS of $2.31.
Management issued an upbeat 2022 view due to high demand, improved price realization and inventory management, a robust holiday season, and the company's focus on streamlining its e-commerce capabilities through its rapidly growing mobile app. Additionally, CRI's forward earnings multiple of 10.8X is much lower than the industry's 14.4X average.
With the full-year consensus estimate trend increasing, remarkable EPS beats, and an upbeat 2022 view, CRI has instilled confidence surrounding its future performance. Combined with its Zacks Rank #1 and VGM Score of an A, I believe that Carter's would be a strong addition to your portfolio.
Target
Target provides an array of goods ranging from household essentials and electronics to toys and apparel for men, women, and kids. Target shares have displayed strength over the last year, increasing nearly 21% in value and slightly outpacing the S&P 500. Year-to-date, shares have remained stronger than the general market, declining 3.5%.
Thirty estimate revisions (28 up, two down) have come in the last 60 days. For the next and following quarter, the consensus estimate trend has increased by 5% to $3.06 per share and 8.7% to $3.98 per share. Current and next year EPS estimates have been rapidly revised, increasing by 9.3% to $14.47 per share and 8.7% to $15.76 per share.
Displaying pure consistency and strength, Target has beat EPS expectations 12 quarters in a row dating back to May 2019. Over the last four quarters, the average EPS surprise for the retailer has been 21%, with its most recent quarter beating expectations by nearly 12%, or $0.33.
TGT's recent initiatives like developing its omni-channel capacities, creating more flexible-sized stores, and overall financial strength are key factors driving future growth. Additionally, Target's forward earnings multiple of 15.6X is much lower than the industry's average of 22.6X.
An overwhelming amount of upwards estimate revisions, an increasing bottom line, strong relative performance, and a focus on developing the company's omni-channel capabilities are all reasons why I believe Target would be a great addition to your portfolio. Target is a Zacks Rank #1 and has an overall VGM Score of B.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Builders FirstSource, Carter's and Target
For Immediate Release
Chicago, IL – March 22, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Builders FirstSource (BLDR - Free Report) , Carter’s Inc. (CRI - Free Report) and Target (TGT - Free Report) .
Here are highlights from Monday’s Analyst Blog:
Capitalize on Market Trends with These 3 Retail Stocks
Riding on the tails of last Wednesday's meeting with the Fed, the major indices turned in their best weekly performances since last November and provided investors with a much-needed relief rally.
Investors are hopeful that the rally will last and the market can continue its ascent as the outlook for economic growth strengthens. COVID-19 seems to be retreating, there is a ton of pent-up economic demand, and the Fed's plans have become clearer. With a more robust economic outlook, I believe that retail names stand to benefit.
To capitalize on the market's strength, it's essential to pivot to names that have a strong Zacks Rank paired with a high VGM Score. Let's look at three retail stocks that meet these criteria and analyze why they would be good additions to your portfolio amid a rebounding market.
Builders FirstSource
Builders FirstSource is a leading supplier and manufacturer of structural building products. Shares of the company have been notably strong over the last year, increasing 60% in value and easily outpacing the S&P 500's return of 15%. Year-to-date, BLDR shares haven't been as strong, declining 11% and lagging behind the general market.
BLDR's future growth outlook is impressive due to its high number (16) of upwards estimate revisions over the last 60 days. Current quarter estimates have increased nearly 85% to $2.08 per share, and for the following quarter, estimates have increased 60% to $2.54 per share. Additionally, the consensus estimate trend has increased by 30% to $8.91 per share for the current year, and for the following year, it has increased 33% to $9.23 per share.
Earnings reports for BLDR have been the definition of consistency, chaining together 14 straight EPS beats dating back to August 2018. The average EPS surprise over the last four quarters is nearly 75%, and in its most recent quarter, the company exceeded expectations by 47%, or $0.89.
BLDR is optimistic about notable improvement within its financial performance, expecting net sales in the range of $19.3 billion - $19.8 billion versus the previously expected $18 billion - $19 billion. The company's 8.8X forward earnings multiple is also much lower than the Zacks Building Products – Retail Industry's average of 16.3X.
The consensus estimate trend for BLDR has been rapidly increasing, earnings reports have consistently beat expectations, and the company's forward earnings multiple is notably lower than the industry average. Additionally, its Zacks Rank #1 (Strong Buy) and its VGM Score of an A reinforce my belief that BLDR would be a great addition to your portfolio amid a rebounding market.
Builders FirstSource, Inc. price-consensus-eps-surprise-chart | Builders FirstSource, Inc. Quote
Carter's Inc.
Carter's is the largest marketer of branded apparel and related products for babies and young children in North America. Shares of the company have lagged behind the general market over the last year, increasing nearly 10% in value. Year-to-date, shares have provided slightly better defense than the S&P 500, decreasing 5% in value.
Out of ten analyst estimate revisions over the last 60 days, eight have been upwards. The next quarter has endured two downwards revisions, causing the consensus estimate trend to decrease 22% to $1.33 per share, and the trend for the following quarter has increased 20% to $1.89 per share. Additionally, the trend has increased by 10% to $8.93 per share for the current year and 12% to $9.71 per share for next year.
Carter's has beaten EPS estimates in each of its last four quarterly reports, providing an average EPS surprise of nearly 200%. Two of the previous four quarterly reports etched in triple-digit surprises, and its most recent quarter beat expectations by 13%, reporting EPS of $2.31.
Management issued an upbeat 2022 view due to high demand, improved price realization and inventory management, a robust holiday season, and the company's focus on streamlining its e-commerce capabilities through its rapidly growing mobile app. Additionally, CRI's forward earnings multiple of 10.8X is much lower than the industry's 14.4X average.
With the full-year consensus estimate trend increasing, remarkable EPS beats, and an upbeat 2022 view, CRI has instilled confidence surrounding its future performance. Combined with its Zacks Rank #1 and VGM Score of an A, I believe that Carter's would be a strong addition to your portfolio.
Target
Target provides an array of goods ranging from household essentials and electronics to toys and apparel for men, women, and kids. Target shares have displayed strength over the last year, increasing nearly 21% in value and slightly outpacing the S&P 500. Year-to-date, shares have remained stronger than the general market, declining 3.5%.
Thirty estimate revisions (28 up, two down) have come in the last 60 days. For the next and following quarter, the consensus estimate trend has increased by 5% to $3.06 per share and 8.7% to $3.98 per share. Current and next year EPS estimates have been rapidly revised, increasing by 9.3% to $14.47 per share and 8.7% to $15.76 per share.
Displaying pure consistency and strength, Target has beat EPS expectations 12 quarters in a row dating back to May 2019. Over the last four quarters, the average EPS surprise for the retailer has been 21%, with its most recent quarter beating expectations by nearly 12%, or $0.33.
TGT's recent initiatives like developing its omni-channel capacities, creating more flexible-sized stores, and overall financial strength are key factors driving future growth. Additionally, Target's forward earnings multiple of 15.6X is much lower than the industry's average of 22.6X.
An overwhelming amount of upwards estimate revisions, an increasing bottom line, strong relative performance, and a focus on developing the company's omni-channel capabilities are all reasons why I believe Target would be a great addition to your portfolio. Target is a Zacks Rank #1 and has an overall VGM Score of B.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.