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Focus Should Be on Consumer Discretionary Sector Earnings

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Earnings to be released

Following the data released by the U.S. Department of Labor on Friday, November 6, 2015, all eyes should be on the earnings of the consumer discretionary sector (XRT), which has quite a few companies lined up for earnings releases in the coming days.

Some important earnings to look forward to can be seen in the above chart.

If we look closely at stocks such as Macy’s (M), Kohl’s (KSS), and Staples (SPLS), which are trading lower than their industry peers in terms of forward PE ratios, we can see that their earnings appear to have bottomed out as a result of recent macroeconomic conditions. Further analysis into their fundamentals could potentially reveal good investment opportunities.

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Analysts’ recommendations for stocks

  1. Macy’s stock has a consensus “hold” rating and a target price of $58.79 in the next 12 months, with a return of 28.0%.
  2. Nordstrom (JWN) stock has a consensus “hold” rating and a target price of $77.70 in the next 12 months, with a return of 24.1%.
  3. Kohl’s stock has a consensus “hold” rating and a target price of $55.10 in the next 12 months, with a return of 25.5%.
  4. L Brands (LB) stock has a consensus “hold” rating and a target price of $101.45 in the next 12 months, with a return of 8.4%.
  5. Staples stock has a consensus “hold” rating and a target price of $18.50 in the next 12 months, with a return of 43.3%.
  6. Target (TGT) stock has a consensus “hold” rating and a target price of $85.00 in the next 12 months, with a return of 12.4%.
  7. The Gap (GPS) stock has a consensus “hold” rating and a target price of $30.62 in the next 12 months, with a return of 11.4%.
  8. Ross Stores (ROST) stock has a consensus “hold” rating and a target price of $55.11 in the next 12 months, with a return of 12.9%.
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