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Strength Seen in Revolve Group (RVLV): Can Its 13.8% Jump Turn into More Strength?

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Revolve Group (RVLV - Free Report) shares ended the last trading session 13.8% higher at $54.27. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 23.6% gain over the past four weeks.

Shares of Revolve Group have been surging owing to the optimism surrounding the reopening of economies as more people get inoculated. The ease in social distancing norms and the return to active social lifestyle, events and occasions are likely to pent-up demand for traditional categories like dresses. The company is also accelerating investments in adjacent product categories like Beauty and Activewear.

Moreover, strength in international markets remains a major catalyst. International net sales surged 24% year over year in the final quarter of 2020, courtesy of double-digit gain in Australia, Canada, Greater China and the Middle East.

Price and Consensus

Price Consensus Chart for Revolve Group

This online women's fashion retailer is expected to post quarterly earnings of $0.12 per share in its upcoming report, which represents a year-over-year change of +100%. Revenues are expected to be $155.33 million, up 6.3% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Revolve Group, the consensus EPS estimate for the quarter has been revised 41.1% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on RVLV going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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