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Tapestry (TPR) Gains But Lags Market: What You Should Know

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In the latest trading session, Tapestry (TPR - Free Report) closed at $41.26, marking a +0.44% move from the previous day. The stock lagged the S&P 500's daily gain of 0.62%. At the same time, the Dow added 0.55%, and the tech-heavy Nasdaq lost 0.03%.

Heading into today, shares of the maker of high-end shoes and handbags had lost 6.78% over the past month, lagging the Retail-Wholesale sector's loss of 4.69% and the S&P 500's gain of 0.39% in that time.

Investors will be hoping for strength from Tapestry as it approaches its next earnings release. The company is expected to report EPS of $1.18, up 2.61% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $1.98 billion, up 17.62% from the year-ago period.

TPR's full-year Zacks Consensus Estimates are calling for earnings of $3.50 per share and revenue of $6.59 billion. These results would represent year-over-year changes of +17.85% and +14.76%, respectively.

Any recent changes to analyst estimates for Tapestry should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Tapestry is currently a Zacks Rank #2 (Buy).

Digging into valuation, Tapestry currently has a Forward P/E ratio of 11.73. Its industry sports an average Forward P/E of 12.2, so we one might conclude that Tapestry is trading at a discount comparatively.

It is also worth noting that TPR currently has a PEG ratio of 0.95. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. TPR's industry had an average PEG ratio of 0.95 as of yesterday's close.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 56, putting it in the top 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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