Here are two trading opportunities in retail stocks whose shares have been beaten down.
Lululemon Athletica (LULU) and Zulily (ZU)
from Shortex Market Letter
Lululemon Athletica (LULU)
52-week high/low: 77.75/36.26
Market Cap: $6.34B
EPS: 1.91
P/E: 22.12
The maker of yoga apparel/athletic gear reported FY Q2 revenue increase of 13% to $390.7M. On-line sales up 30%. Income @ $48.7M, down 14%. Raised full year guidance to $1.77/shr and revenue to $1.78B-$1.8B. Reaching a truce. Between the board and founder Dennis “Chip” Wilson a plus. Gapped-up through primary resistance @ (40-42). Heading toward the secondary resistance @ (47-48) in the offing.
Buying Range: 40-44
Near Term Objective: 59
Intermediate Objective: 71
Stop Loss: 36
Zulily (ZU)
52-week high/low: 73.50/28.75
Market Cap: $4.63B
EPS: 0.02
P/E: 72.44
The e-commerce flash-selling retailer allows discounted prices with little inventory to its special customers: mothers/children apparels/toys/shoes and misc. Trading above its 50 & 200-DMA. Maintaining RSI of 48.81. Secondary resistance @ (39-42). Filling the previous downed-gap @ (37-45) a must. Challenging upper-head resistance @ (50-52).
Buying Range: 35-41
Near Term Objective: 54
Intermediate Objective: 68
Stop Loss: 34
Joseph Parnes, Shortex Market Letter, www.shortex.com, 800-877-6555, September 23, 2014