Top 4 Consumer Stocks That May Explode In November

In the latest market close, American Eagle Outfitters (AEO) reached $17.94, with a -1.48% movement compared to the previous day. The stock's change was less than the S&P 500's daily loss of 0.29%. Elsewhere, the Dow lost 0.86%, while the tech-heavy Nasdaq lost 0.09%.

The teen clothing retailer's stock has dropped by 12.07% in the past month, falling short of the Retail-Wholesale sector's gain of 3.95% and the S&P 500's gain of 3.3%.

The investment community will be closely monitoring the performance of American Eagle Outfitters in its forthcoming earnings report. The company is predicted to post an EPS of $0.47, indicating a 4.08% decline compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $1.31 billion, showing a 0.45% escalation compared to the year-ago quarter.

AEO's full-year Zacks Consensus Estimates are calling for earnings of $1.78 per share and revenue of $5.39 billion. These results would represent year-over-year changes of +17.11% and +2.46%, respectively.

Investors should also take note of any recent adjustments to analyst estimates for American Eagle Outfitters. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.16% lower within the past month. As of now, American Eagle Outfitters holds a Zacks Rank of #3 (Hold).

With respect to valuation, American Eagle Outfitters is currently being traded at a Forward P/E ratio of 10.26. For comparison, its industry has an average Forward P/E of 15.56, which means American Eagle Outfitters is trading at a discount to the group.

Also, we should mention that AEO has a PEG ratio of 0.91. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Retail - Apparel and Shoes industry held an average PEG ratio of 1.8.

The Retail - Apparel and Shoes industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 137, which puts it in the bottom 46% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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Maplebear (CART) came out with quarterly earnings of $0.42 per share, beating the Zacks Consensus Estimate of $0.22 per share. This compares to loss of $20.86 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of 90.91%. A quarter ago, it was expected that this operator of the Instacart online grocery would post earnings of $0.13 per share when it actually produced earnings of $0.20, delivering a surprise of 53.85%.

Over the last four quarters, the company has surpassed consensus EPS estimates four times.

Maplebear, which belongs to the Zacks Internet - Commerce industry, posted revenues of $852 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 0.81%. This compares to year-ago revenues of $764 million. The company has topped consensus revenue estimates three times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Maplebear shares have added about 103.4% since the beginning of the year versus the S&P 500's gain of 25.8%.

What's Next for Maplebear?

While Maplebear has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Maplebear: favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead. The current consensus EPS estimate is $0.33 on $893.8 million in revenues for the coming quarter and $1.17 on $3.38 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Commerce is currently in the top 27% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Another stock from the broader Zacks Retail-Wholesale sector, American Eagle Outfitters (AEO), has yet to report results for the quarter ended October 2024.

This teen clothing retailer is expected to post quarterly earnings of $0.47 per share in its upcoming report, which represents a year-over-year change of -4.1%. The consensus EPS estimate for the quarter has been revised 0.3% lower over the last 30 days to the current level.

American Eagle Outfitters' revenues are expected to be $1.31 billion, up 0.5% from the year-ago quarter.

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