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Capri Holdings (CPRI) Gains But Lags Market: What You Should Know

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Capri Holdings (CPRI - Free Report) closed at $48.65 in the latest trading session, marking a +0.23% move from the prior day. The stock lagged the S&P 500's daily gain of 0.57%. At the same time, the Dow added 0.7%, and the tech-heavy Nasdaq lost 0.11%.

Prior to today's trading, shares of the luxury retailer had lost 9.91% over the past month. This has lagged the Retail-Wholesale sector's loss of 7.64% and the S&P 500's loss of 5.26% in that time.

Capri Holdings will be looking to display strength as it nears its next earnings release. On that day, Capri Holdings is projected to report earnings of $0.82 per share, which would represent year-over-year growth of 115.79%. Our most recent consensus estimate is calling for quarterly revenue of $1.4 billion, up 17.13% from the year-ago period.

Any recent changes to analyst estimates for Capri Holdings should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Capri Holdings is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Capri Holdings currently has a Forward P/E ratio of 7.32. Its industry sports an average Forward P/E of 9.03, so we one might conclude that Capri Holdings is trading at a discount comparatively.

It is also worth noting that CPRI currently has a PEG ratio of 0.14. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Retail - Apparel and Shoes was holding an average PEG ratio of 0.83 at yesterday's closing price.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 93, putting it in the top 37% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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