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Rocky Brands (RCKY) Soars to a 52-Week High, Time to Cash Out?
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Have you been paying attention to shares of Rocky Brands, Inc. (RCKY - Free Report) ? Shares have been on the move with the stock up 33.5% over the past month. RCKY hit a new 52-week high of $22 in the previous session. Rocky Brands has gained 14.8% since the start of the year compared to the 2.5% move for the Consumer Discretionary sector and the 5.3% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on February 20, 2018, Rocky Brands reported EPS of $0.37 versus the Zacks Consensus Estimate of $0.25 while it beat the consensus revenue estimate by 1.66%.
For the current fiscal year, Rocky Brands is expected to post earnings of $1.4 per share on $247.9 million in revenues. This represents a 20.69% change in EPS on a -2.09% change in revenues. For the next fiscal year, the company is expected to earn $1.55 per share on $255.6 million in revenues. This represents changes of 10.71% and 3.11%, respectively.
Valuation Metrics
Rocky Brands may be at a 52-week high right now, but what might the future hold for RCKY? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Rocky Brands has a Value Score of A. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 15.5X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 10.4X versus its peer group's average of 13.6X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Rocky Brands currently has a Zacks Rank #1 (Strong Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 or 2 (Buy) and Style Scores of A or B, it looks as if Rocky Brands, Inc. passes the test. Thus, it seems as though RCKY shares could have potential in the weeks and months to come.
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Rocky Brands (RCKY) Soars to a 52-Week High, Time to Cash Out?
Have you been paying attention to shares of Rocky Brands, Inc. (RCKY - Free Report) ? Shares have been on the move with the stock up 33.5% over the past month. RCKY hit a new 52-week high of $22 in the previous session. Rocky Brands has gained 14.8% since the start of the year compared to the 2.5% move for the Consumer Discretionary sector and the 5.3% year-to-date return for its peer group.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on February 20, 2018, Rocky Brands reported EPS of $0.37 versus the Zacks Consensus Estimate of $0.25 while it beat the consensus revenue estimate by 1.66%.
For the current fiscal year, Rocky Brands is expected to post earnings of $1.4 per share on $247.9 million in revenues. This represents a 20.69% change in EPS on a -2.09% change in revenues. For the next fiscal year, the company is expected to earn $1.55 per share on $255.6 million in revenues. This represents changes of 10.71% and 3.11%, respectively.
Valuation Metrics
Rocky Brands may be at a 52-week high right now, but what might the future hold for RCKY? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Rocky Brands has a Value Score of A. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 15.5X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 10.4X versus its peer group's average of 13.6X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Rocky Brands, Inc. Price and Consensus
Rocky Brands, Inc. Price and Consensus | Rocky Brands, Inc. Quote
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Rocky Brands currently has a Zacks Rank #1 (Strong Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 or 2 (Buy) and Style Scores of A or B, it looks as if Rocky Brands, Inc. passes the test. Thus, it seems as though RCKY shares could have potential in the weeks and months to come.