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Big Movers on the Consumer Cyclical Sector Today, Including BWA
The Nasdaq has risen 0.8%, the S&P 500 has increased 0.7% and the Dow has moved up 0.6%, marking a bad morning for the market. The consumer cyclical sector is a category of stocks that relies heavily on the business cycle and economic conditions. Consumer cyclicals include industries such as automotive, housing, entertainment and retail. The category can be further divided into durable and non-durable sections. Durable cyclicals include physical goods such as hardware or vehicles, while non-durables represent items like movies or hotel services. The performance of consumer cyclicals is highly related to the state of the economy. They represent goods and services that are not considered necessities, but luxurious purchases. During contractions or recessions, people have less disposable income to spend on consumer cyclicals. When the economy is expanding or booming, the sales of these goods rise as retail and leisure spending increase.
The Consumer Cyclical sector (XLY) is up 0.9%, outperforming the market overall. The biggest movers in the sector so far are:
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Fossil (Nasdaq:FOSL) is currently at $92.25 per share after a dramatic increase of 32.2%. So far today, 4.6 million shares have changed hands. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. Perhaps one of the most widely-used stock analysis tools is the price-to-earnings ratio, or P/E. Relative to the industry P/E ratio of 19.73, FOSL's 14.9 is low. A low P/E ratio may indicate that the market expects relatively slower earnings growth. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: Profit With The Power Of Price-To-Earnings
Warnaco Group (NYSE:WRC) has soared 13.7% to reach a current price of $48.41 per share. With 1.2 million shares changing hands so far today, the company's volume is 2.6 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. The debt ratio is calculated by dividing total liabilities by total assets. WRC has a low debt ratio of 46.1%. In other words, the company is less sensitive to changes in business or interest rates since less of its cash flow is dedicated to paying off loan expenses. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
After a big jump of 11.4%, Movado Group (NYSE:MOV) is trading at $25.31 per share. The company is trading at a volume of 188,125 shares. Yesterday, volume was only 58,855 shares. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/sales ratio measures a company's stock market price by its revenues. The P/S ratio for MOV is a high 1.48. This could be a good sign if the share price increases. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
PVH (NYSE:PVH) has risen 6.4% and is currently trading at $83.93 per share. So far today, the company's volume is 920,848 shares, one times the current daily average. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. Valuation ratios allow the investor to make a quick determination as to a company's investment value. A company's capitalization (not to be confused with its market capitalization) is the term used to describe the makeup of a company's permanent or long-term capital, which consists of both long-term debt and shareholders' equity. The capitalization ratio for PVH is 38.8%. The capitalization ratio is one of the more meaningful debt ratios because it focuses on the relationship of debt liabilities as a component of a company's total capital base, which is the capital raised by shareholders and lenders.
After an increase of 6.3%, Visteon (NYSE:VC) has reached a current price of $31.90. The company's volume for the day so far is 510,163 shares. High volume indicates a lot of investor interest while low volume indicates the opposite. A company's value as an investment is more easily estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. VC's debt-equity ratio of 42% is on the low end. This shows that the company's assets are financed primarily through equity. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
After rising 4.8%, Oxford Industries (NYSE:OXM) is currently trading at a share price of $45.57. The company's volume for the day so far is 19,861 shares, 0.1 times the average volume over the last three months. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). OXM's PEG ratio of 1.64 is in line with the industry average. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.
BorgWarner (NYSE:BWA) has risen 3.4% to hit a current price of $70.11 per share. The company's volume for the day so far is 796,754 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/book value ratio is especially important for value investors as it can provide an indication of the true value of a company's assets at a time when its business model may be failing. The P/B ratio for BWA is 2.79, indicating that the stock is trading for more than its book value. It is important to take the company's debt into account when using the P/B ratio as debt can boost a company's liabilities to the point where they wipe out much of the book value of its hard assets, creating artificially high P/B values. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Using The Price-To-Book Ratio To Evaluate Companies
The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Daily stock performance should be weighed against historical performance and put in context of the market overall. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.
The Consumer Cyclical sector (XLY) is up 0.9%, outperforming the market overall. The biggest movers in the sector so far are:
| Company | Market Cap | Percentage Change |
| Fossil, Inc. (Nasdaq:FOSL) | $4.32 billion | +32.2% |
| Warnaco Group Inc (NYSE:WRC) | $1.75 billion | +13.7% |
| Movado Group, Inc (NYSE:MOV) | $571.2 million | +11.4% |
| PVH Corp (NYSE:PVH) | $5.55 billion | +6.4% |
| Visteon Corporation (NYSE:VC) | $1.58 billion | +6.3% |
| Oxford Industries, Inc. (NYSE:OXM) | $719.4 million | +4.8% |
| BorgWarner Inc. (NYSE:BWA) | $7.76 billion | +3.4% |
Fossil (Nasdaq:FOSL) is currently at $92.25 per share after a dramatic increase of 32.2%. So far today, 4.6 million shares have changed hands. Price change alone is not enough to know how a stock is doing. Volume is an important secondary indicator used to confirm trends suggested by price movement. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. Perhaps one of the most widely-used stock analysis tools is the price-to-earnings ratio, or P/E. Relative to the industry P/E ratio of 19.73, FOSL's 14.9 is low. A low P/E ratio may indicate that the market expects relatively slower earnings growth. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: Profit With The Power Of Price-To-Earnings
Warnaco Group (NYSE:WRC) has soared 13.7% to reach a current price of $48.41 per share. With 1.2 million shares changing hands so far today, the company's volume is 2.6 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. The debt ratio is calculated by dividing total liabilities by total assets. WRC has a low debt ratio of 46.1%. In other words, the company is less sensitive to changes in business or interest rates since less of its cash flow is dedicated to paying off loan expenses. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
After a big jump of 11.4%, Movado Group (NYSE:MOV) is trading at $25.31 per share. The company is trading at a volume of 188,125 shares. Yesterday, volume was only 58,855 shares. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/sales ratio measures a company's stock market price by its revenues. The P/S ratio for MOV is a high 1.48. This could be a good sign if the share price increases. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
After an increase of 6.3%, Visteon (NYSE:VC) has reached a current price of $31.90. The company's volume for the day so far is 510,163 shares. High volume indicates a lot of investor interest while low volume indicates the opposite. A company's value as an investment is more easily estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The debt-equity (D/E) ratio is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. VC's debt-equity ratio of 42% is on the low end. This shows that the company's assets are financed primarily through equity. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.
After rising 4.8%, Oxford Industries (NYSE:OXM) is currently trading at a share price of $45.57. The company's volume for the day so far is 19,861 shares, 0.1 times the average volume over the last three months. When a stock price moves up or down, watching the volume is a good way of identifying how significant that shift is. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. Using price/earnings ratios (P/E ratios) does not give an indication of whether or not an individual company's ratio is reasonable, a shortcoming that can be corrected by using the price/earnings to growth ratio (PEG ratio). OXM's PEG ratio of 1.64 is in line with the industry average. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.
BorgWarner (NYSE:BWA) has risen 3.4% to hit a current price of $70.11 per share. The company's volume for the day so far is 796,754 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. The price/book value ratio is especially important for value investors as it can provide an indication of the true value of a company's assets at a time when its business model may be failing. The P/B ratio for BWA is 2.79, indicating that the stock is trading for more than its book value. It is important to take the company's debt into account when using the P/B ratio as debt can boost a company's liabilities to the point where they wipe out much of the book value of its hard assets, creating artificially high P/B values. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Using The Price-To-Book Ratio To Evaluate Companies
The Bottom Line No matter the economic climate, Wall Street will always have stocks that make major moves each week. Daily stock performance should be weighed against historical performance and put in context of the market overall. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.
by
Investopedia Staff
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