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Bear of the Day: Ethan Allen (ETH)

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Stock prices are fickle. One day you’re a rock star, the next you’re down in the dumps. Prices change on a dime and are tough to predict from day-to-day. What’s much more constant is the trend of earnings. Earnings estimates typically don’t gyrate back-and-forth like prices do. They tend to move in the same direction for several quarters in a row. When looking for a Bear of the Day, I like to find earnings trends which are moving in the negative direction. That’s exactly the case with today’s Bear, Ethan Allen Interiors (ETH - Free Report) .

Ethan Allen Interiors Inc. operates as an interior design company, and manufacturer and retailer of home furnishings in North America, Asia, the Middle East, and Europe. The company operates through two segments, Wholesale and Retail. Its products include case goods items, such as beds, dressers, armoires, tables, chairs, buffets, entertainment units, home office furniture, and wooden accents; upholstery items comprising sleepers, recliners and other motion furniture, chairs, ottomans, custom pillows, sofas, loveseats, cut fabrics, and leather; and home accents and other items consisting of window treatments and drapery hardware, wall decors, florals, lighting, clocks, mattresses, bedspreads, throws, pillows, decorative accents, area rugs, wall coverings, and home and garden furnishings. 

The stock is a Zacks Rank #5 (Strong Sell) right now in an industry which ranks in the Bottom 21% of our Zacks Industry Rank. The reason for the unfavorable rank lies in recent negative moves from analysts. Over the last sixty days, five analysts have cut their earnings estimates for the current year while two analysts have dropped their number for next year. This has dropped the Zacks Consensus Estimate for the current year from $1.63 to $1.53 while next year’s number has come down from $1.87 to $1.71.

Investors looking for other stocks within the same industry should check out Zacks Rank #2 (Buy) Restoration Hardware (RH - Free Report) . There are also several stocks within the same industry that are Zacks Rank #3 (Hold) stocks. Among them are At Home Group (HOME - Free Report) and Pier 1 Imports (PIR - Free Report) .

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