Are Consumer Discretionary Stocks Lagging Stride (LRN) This Year?

For those looking to find strong Consumer Discretionary stocks, it is prudent to search for companies in the group that are outperforming their peers. Is K12 (LRN) one of those stocks right now? By taking a look at the stock's year-to-date performance in comparison to its Consumer Discretionary peers, we might be able to answer that question.

K12 is a member of our Consumer Discretionary group, which includes 285 different companies and currently sits at #10 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst.

The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. K12 is currently sporting a Zacks Rank of #2 (Buy).

The Zacks Consensus Estimate for LRN's full-year earnings has moved 5.5% higher within the past quarter. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

According to our latest data, LRN has moved about 19.2% on a year-to-date basis. Meanwhile, the Consumer Discretionary sector has returned an average of -3.1% on a year-to-date basis. This shows that K12 is outperforming its peers so far this year.

Another stock in the Consumer Discretionary sector, Netflix (NFLX), has outperformed the sector so far this year. The stock's year-to-date return is 33.3%.

For Netflix, the consensus EPS estimate for the current year has increased 7.5% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy).

Breaking things down more, K12 is a member of the Schools industry, which includes 19 individual companies and currently sits at #46 in the Zacks Industry Rank. On average, stocks in this group have gained 5.1% this year, meaning that LRN is performing better in terms of year-to-date returns.

On the other hand, Netflix belongs to the Broadcast Radio and Television industry. This 20-stock industry is currently ranked #58. The industry has moved +13.9% year to date.

K12 and Netflix could continue their solid performance, so investors interested in Consumer Discretionary stocks should continue to pay close attention to these stocks.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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