Fred’s, Inc. (FRED) Trend of Beating EPS and Revenue Estimates

Fred’s, Inc. (FRED) shares saw a recent bid of $13.60 and 1.44M shares have exchanged hands in the recent trading session, yielding a -2.51% decline over the past week. The stock price increased 3.98% or $-0.52 versus $13.08 at the end of the prior session. This change led market cap to move at $558.69M, putting the price -37.53% below the 52-week high and 72.48% above the 52-week low. The company’s stock has a normal trading capacity of 846.48K shares while the relative volume is 1.71.

To stay one step ahead we extended our research by comparing different price targets. The stock notched a 12-month high of $18.33 while $21.00 target is by far the most aggressive out of analysts who are currently evaluating the company, $2.67 higher than the next highest 52-week price estimate. The lowest 12-month price target for the shares is $17.00, which would be an increase of about 25% of its current value. The mean target of $17.00 should be compared with the price when the stock was languishing around $7.89 a share. And it remains to be seen which target price FRED can achieve without sacrificing much as the company is holding a -10.05% fall for the past twelve months.

By historical standards, Fred’s, Inc. remains a cheap stock. The company’s current price-earnings ratio amounts above the average P/E ratio of 25.09 times earnings. For now, Fred’s, Inc. is the toast of Wall Street as its ABR stands at 2.50 with 1 out of 4 analysts rating the stock a buy. Over the short term, some market observers may have noticed that Fred’s, Inc. has a 41.23% short float with 15 days to cover. It becomes significant when you consider how many shares are shorted versus the average daily volume, means how many days to cover those short shares at that volume. Fred’s, Inc. has far performed well this year, with the share price down -26.72% since January. Over the past 2 quarters, the stock is up 35.59%, compared with a fall of nearly -15.11% for 3 months and about -4.49% for the past 30 days.

Last time, the company shocked Wall Street by reporting EPS of $-0.11, smashing the consensus of $-0.16 per share. Revenue for the quarter also did not kill consensus, coming in at $529.73M, compared to the consensus of 530.21M. Nonetheless, from here on out, earnings per share forecasts for the current quarter are $-0.12. The company is expected to report EPS as high as $-0.03 and as low as $-0.24 per share. Similarly, full-year EPS forecasts have ranged between $-0.60 and $-0.48. The mean EPS estimate is $-0.54. On the other side, sales forecasts for the current quarter are $507.42M. The stock is expected to report revenue as high as $529.4M and as low as $493.6M per share. Similarly, full-year sales forecasts have ranged between $2.13B and $2.13B. The mean revenue estimate is $2.13B.

Over the last 5 years, Fred’s, Inc. has averaged a -32.40% YoY EPS growth rate and a 2.50% revenue growth rate. Analysts are expecting EPS growth rates to be at -797.70% this quarter and EPS estimate for next year reflect 159.94% growth rate.

Sell-side analysts also have something to say about this company. Sidoti raised its rating on Fred’s, Inc. to Buy on 07/02/2017 in a reversal from its prior Neutral rating. Sidoti had a markedly different take on 20/12/2016, proposing that Fred’s, Inc. is now considered Neutral versus prior Buy rating. Deutsche Bank analysts stated on 01/11/2016 that they maintained their Hold rating. Sidoti raised its rating on Fred’s, Inc. to Buy on 07/10/2016 in a reversal from its prior Neutral rating.

Fred’s, Inc. (FRED) Trend of Beating EPS and Revenue Estimates was last modified: June 6th, 2017 by Caleb Gerald
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