Which Top 5 Clothing Retailer Stocks have the Strongest Earnings Trends?

Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).

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Here’s your Cheat Sheet to how the top 5 clothing retailer stocks rank via earnings trends:

Abercrombie & Fitch Co. (NYSE:ANF): Current Price $46.86

Fiscal Year 2008 2009 2010 2011 2012
Revenue ($) in millions 3,700 3,484 2,929 3,469 4,158
Diluted EPS ($) 5.20 3.05 0.00 1.67 1.43

After a dismal year in 2010, Abercrombie and Fitch bounced back with much better sales and EPS in 2011 and 2012.

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Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:

Quarter Oct. 31, 2011 Jan. 31, 2012 Apr. 30, 2012 Jul. 31, 2012 Oct. 31, 2012
Revenue ($) in millions 1,076 1,329 921.22 951.41 1,170
Diluted EPS ($) 0.57 0.23 0.03 0.19 0.87

We see the same pattern in the quarterly reports, and both topline and EPS headed for the moon after the April 2012 quarter. This company is in the running for winning this analysis…