My largest single position right now is La-Z-Boy, and the consolidating price action the last few days is telling me the time may be right.
Deep Value
La-Z-Boy offers a 2.1% forward dividend yield and currently trades at about 10 forward P/E, .74 forward P/S, and a fantastic 5.6 P/FCF. The low price multiples on this wonderful cash cow are well below the stock's five-year median. I estimate a whopping 38% upside to the median multiple of the last five years!
If La-Z-Boy's trading at a discount, it's not for lack of growth. We're talking 4% earnings growth, 4% dividend growth, 1.7% sales growth, and 8% free cash flow growth, on average, since 2017. In addition to paying dividends, La-Z-Boy has also consistently bought back shares. Of the value stocks I follow, La-Z-Boy is in the 10th cheapest on a price ratio basis (trailing and forward P/E, P/S, P/D, P/FCF) and the 6th cheapest on a price-to-growth ratio basis (PEG, PSG, PDG, PFCFG).
La-Z-Boy has been innovating lately. You get an average of 4.5 new patents per year per billion dollars of market cap, making this a relatively cheap technology play. (Did I just call a furniture company a technology play? Yes, I did.) S&P Global gives La-Z-Boy an average fundamentals score of 88.25/100. It scores middle-of-the-road on ESG. I rate the earnings outlook a 5/6, with projected future growth and mostly positive recent forecast revisions.
Bullish Sentiment
The average analyst score on La-Z-Boy is 6.4/10, putting it in bullish but not strongly bullish territory. However, options traders are highly bullish on the stock, with open interest sitting at 0.15. That's the most bullish open interest of any stock I follow. Options trading volume is quite bullish as well.
News on La-Z-Boy has been mostly positive. Last quarter's earnings and sales handily beat estimates, and La-Z-Boy is upgrading its Neosho, MO manufacturing plant. The stock's been beaten down due to supply chain troubles and materials costs, but with the stock near strong support and open interest so positive, I think the selloff may have exhausted itself.
Support-Resistance
In technical terms, we've got upside to at least the 20-day exponential moving average at $35.04 per share, with strong support from the 200-week at 32.85. That's a net-positive reward-minus-risk of 3.9%.
Deep Value
La-Z-Boy offers a 2.1% forward dividend yield and currently trades at about 10 forward P/E, .74 forward P/S, and a fantastic 5.6 P/FCF. The low price multiples on this wonderful cash cow are well below the stock's five-year median. I estimate a whopping 38% upside to the median multiple of the last five years!
If La-Z-Boy's trading at a discount, it's not for lack of growth. We're talking 4% earnings growth, 4% dividend growth, 1.7% sales growth, and 8% free cash flow growth, on average, since 2017. In addition to paying dividends, La-Z-Boy has also consistently bought back shares. Of the value stocks I follow, La-Z-Boy is in the 10th cheapest on a price ratio basis (trailing and forward P/E, P/S, P/D, P/FCF) and the 6th cheapest on a price-to-growth ratio basis (PEG, PSG, PDG, PFCFG).
La-Z-Boy has been innovating lately. You get an average of 4.5 new patents per year per billion dollars of market cap, making this a relatively cheap technology play. (Did I just call a furniture company a technology play? Yes, I did.) S&P Global gives La-Z-Boy an average fundamentals score of 88.25/100. It scores middle-of-the-road on ESG. I rate the earnings outlook a 5/6, with projected future growth and mostly positive recent forecast revisions.
Bullish Sentiment
The average analyst score on La-Z-Boy is 6.4/10, putting it in bullish but not strongly bullish territory. However, options traders are highly bullish on the stock, with open interest sitting at 0.15. That's the most bullish open interest of any stock I follow. Options trading volume is quite bullish as well.
News on La-Z-Boy has been mostly positive. Last quarter's earnings and sales handily beat estimates, and La-Z-Boy is upgrading its Neosho, MO manufacturing plant. The stock's been beaten down due to supply chain troubles and materials costs, but with the stock near strong support and open interest so positive, I think the selloff may have exhausted itself.
Support-Resistance
In technical terms, we've got upside to at least the 20-day exponential moving average at $35.04 per share, with strong support from the 200-week at 32.85. That's a net-positive reward-minus-risk of 3.9%.
Comment:
Congrats to those who took the trade, especially with a short-dated call position. LZB up over 3% today. Likely to top out for the day at 34.49, 34.64, or 34.82.
Comment:
We've had a decent bounce from 200 EMA. Now we're at the true decision point with some resistances ahead.
Comment:
Solid 3% gain today as we surged through 20-day EMA resistance.
Comment:
There was a bit of a dip on the earnings report (small earnings miss, large sales beat), but strong rally today. This remains my largest long position, FWIW.
