Earnings Estimates Moving Higher for Caleres Inc. (CAL): Time to Buy?
Caleres Inc. (CAL) shares have started gaining and might continue moving higher in the near term, as indicated by solid earnings estimate revisions.
Caleres Inc. (CAL) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company.
The rising trend in estimate revisions, which is a result of growing analyst optimism on the earnings prospects of this footwear wholesaler and retailer, should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- has this insight at its core.
The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.
For Caleres Inc. There has been strong agreement among the covering analysts in raising earnings estimates, which has helped push consensus estimates considerably higher for the next quarter and full year.
The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:
12 Month EPS
Current-Quarter Estimate Revisions
The company is expected to earn $0.46 per share for the current quarter, which represents a year-over-year change of +1433.33%.
Over the last 30 days, one estimate has moved higher for Caleres Inc. compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 31.43%.
Current-Year Estimate Revisions
For the full year, the earnings estimate of $3.85 per share represents a change of +375% from the year-ago number.
There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, one estimate has moved up for Caleres Inc. versus no negative revisions. This has pushed the consensus estimate 16.67% higher.
Favorable Zacks Rank
The promising estimate revisions have helped Caleres Inc. earn a Zacks Rank #2 (Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.
Investors have been betting on Caleres Inc. because of its solid estimate revisions, as evident from the stock's 20.6% gain over the past four weeks. As its earnings growth prospects might push the stock higher, you may consider adding it to your portfolio right away.
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