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Vera Bradley (VRA) Hits 52-Week High, Can the Run Continue?
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Have you been paying attention to shares of Vera Bradley (VRA - Free Report) ? Shares have been on the move with the stock up 20.7% over the past month. The stock hit a new 52-week high of $17.38 in the previous session. Vera Bradley has gained 37.6% since the start of the year compared to the 17.5% move for the Zacks Retail-Wholesale sector and the 6.5% return for the Zacks Retail - Apparel and Shoes industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on September 5, 2018, Vera Bradley reported EPS of $0.26 versus consensus estimate of $0.17.
For the current fiscal year, Vera Bradley is expected to post earnings of $0.6 per share on $417.49 million in revenues. This represents a 0% change in EPS on a -8.17% change in revenues. For the next fiscal year, the company is expected to earn $0.7 per share on $422.25 million in revenues. This represents a year-over-year change of 16.67% and 1.14%, respectively.
Valuation Metrics
Vera Bradley may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort 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.
Vera Bradley has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 27.9X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 14.5X versus its peer group's average of 10.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
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, Vera Bradley currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Vera Bradley fits the bill. Thus, it seems as though Vera Bradley shares could have a bit more room to run in the near term.
How Does Vera Bradley Stack Up to the Competition?
Shares of Vera Bradley have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including DSW , Shoe Carnival (SCVL - Free Report) , and Urban Outfitters (URBN - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 20% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Vera Bradley, even beyond its own solid fundamental situation.
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Vera Bradley (VRA) Hits 52-Week High, Can the Run Continue?
Have you been paying attention to shares of Vera Bradley (VRA - Free Report) ? Shares have been on the move with the stock up 20.7% over the past month. The stock hit a new 52-week high of $17.38 in the previous session. Vera Bradley has gained 37.6% since the start of the year compared to the 17.5% move for the Zacks Retail-Wholesale sector and the 6.5% return for the Zacks Retail - Apparel and Shoes industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on September 5, 2018, Vera Bradley reported EPS of $0.26 versus consensus estimate of $0.17.
For the current fiscal year, Vera Bradley is expected to post earnings of $0.6 per share on $417.49 million in revenues. This represents a 0% change in EPS on a -8.17% change in revenues. For the next fiscal year, the company is expected to earn $0.7 per share on $422.25 million in revenues. This represents a year-over-year change of 16.67% and 1.14%, respectively.
Valuation Metrics
Vera Bradley may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort 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.
Vera Bradley has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 27.9X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 14.5X versus its peer group's average of 10.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
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, Vera Bradley currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Vera Bradley fits the bill. Thus, it seems as though Vera Bradley shares could have a bit more room to run in the near term.
How Does Vera Bradley Stack Up to the Competition?
Shares of Vera Bradley have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including DSW , Shoe Carnival (SCVL - Free Report) , and Urban Outfitters (URBN - Free Report) , all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 20% of all the industries we have in our universe, so it looks like there are some nice tailwinds for Vera Bradley, even beyond its own solid fundamental situation.