Finish Line (FINL) estimates saw a nice boost on the latest quarterly results. Share price is rising and the stock is also showing some solid valuations.

Company Description

The Finish Line, Inc. is a mall-based footwear retailer for athletic footwear, apparel and accessories. The company has more than 650 locations across the U.S.

Beat the Street

Earnings surprises are one of the fist things I look for when evaluating a company The Finish Line is on a hot streak. The company reported its third consecutive earnings surprise on Mar 25.

The Finish Line reported earnings per share of 61 cents last quarter, topping the Zacks Consensus Estimate by 13 cents. EPS rose more than 50% since the same period last year.

Net sales improved 9% to $375 million. Same-store sales helped out, rising 10% in the quarter. The most recent sales period, ending Mar 21, saw a 15.5% increase in comparable store sales on a month-to-month basis.

Estimates Jump

Analysts rushed to raise their forecasts following the earnings news. The Zacks Consensus Estimate for Finish Line’s current full-year is now $1.08, up from 83 cents on 11 upward revisions.

Next year’s estimates are averaging $1.18, up from 87 cents on 5 revisions. If these estimates are met the growth rates would be 28% this year and 9% next year.

Valuations

Shares of FINL are trading at less than 16 times forward earnings and with a price-to-sales ratio of 0.79. Growth rates are a bit pricey, with a PEG ratio of 1.4, but the growth story here is in the estimate revisions not the 5-year growth projections.

Additionally, given the improving economic conditions and consumer trends, we could see those long-term growth projections start to improve.

The Chart

After The Finish Line reported its quarterly results, shares jumped. The overall trend is pointing higher as they continue to set higher lows, but I am seeing some resistance at the current level. We will find out soon if the trend will hold up or if share will be held down by the resistance.

The Finish Line - ticker FINL > <P ALIGN=

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service Zacks Investment Research