Today's Pre-Market Trading Very Positive For L Brands (LB)

Trade-Ideas LLC identified L Brands (LB) as a pre-market leader candidate
By TheStreet Wire ,

Trade-Ideas LLC identified

L Brands

(

LB

) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified L Brands as such a stock due to the following factors:

  • LB has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $167.1 million.
  • LB traded 44,607 shares today in the pre-market hours as of 7:44 AM.
  • LB is up 2.2% today from yesterday's close.

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More details on LB:

L Brands, Inc. operates as a specialty retailer of women's intimate and other apparel, beauty and personal care products, and accessories. The company operates in three segments: Victoria's Secret, Bath & Body Works, and Victoria's Secret and Bath & Body Works International. The stock currently has a dividend yield of 3.5%. LB has a PE ratio of 17. Currently there are 8 analysts that rate L Brands a buy, 2 analysts rate it a sell, and 14 rate it a hold.

The average volume for L Brands has been 3.5 million shares per day over the past 30 days. L has a market cap of $19.4 billion and is part of the services sector and retail industry. The stock has a beta of 0.80 and a short float of 5.1% with 5.14 days to cover. Shares are down 30% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates L Brands as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 6.8%. Since the same quarter one year prior, revenues slightly increased by 4.1%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Net operating cash flow has increased to -$114.00 million or 26.92% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.85%.
  • 44.95% is the gross profit margin for L BRANDS INC which we consider to be strong. Regardless of LB's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 5.81% trails the industry average.
  • The share price of L BRANDS INC has not done very well: it is down 21.05% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Specialty Retail industry. The net income has significantly decreased by 39.2% when compared to the same quarter one year ago, falling from $250.00 million to $152.00 million.

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