Trade-Ideas: L Brands (LB) Is Today's Post-Market Leader Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified L Brands ( LB) as a post-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 $125.2 million.
  • LB is up 2% today from today'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 two segments, Victoria's Secret and Bath & Body Works. The stock currently has a dividend yield of 2.2%. LB has a PE ratio of 20.2. Currently there are 14 analysts that rate L Brands a buy, 2 analysts rate it a sell, and 7 rate it a hold.

The average volume for L Brands has been 1.4 million shares per day over the past 30 days. L has a market cap of $18.3 billion and is part of the services sector and retail industry. The stock has a beta of 0.91 and a short float of 2.4% with 3.72 days to cover. Shares are up 2.2% year-to-date as of the close of trading on Tuesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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, growth in earnings per share and increase in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from the ratings report include:
  • LB's revenue growth has slightly outpaced the industry average of 0.3%. Since the same quarter one year prior, revenues slightly increased by 5.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • L BRANDS INC has improved earnings per share by 10.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, L BRANDS INC increased its bottom line by earning $3.05 versus $2.54 in the prior year. This year, the market expects an improvement in earnings ($3.15 versus $3.05).
  • The stock price has risen over the past year, but, despite its earnings growth and some other positive factors, it has underperformed the S&P 500 so far. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 45.67% 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 6.56% trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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