10 Expensive Consumer Cyclicals Falling Hard

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 |  Includes: AMZN, BEL, CCO, H, LULU, LYV, NFLX, RYL, STON, TOL
by: Follow My Alpha

Companies can get lofty valuations for a variety of reasons, but the fact is, given current market conditions, gravity is starting to take a toll on the consumer stocks we found today. Further, while consumer spending isn't dead, it's hard to justify these lofty valuations from our view, given the restrained nature of consumers when compared to the past. If there was a time to re-evaluate and or review these names, the time is now, given their lofty valuations and the increasing bearish momentum.

The forward P/E is a price multiple valuation metric, which is similar to the current P/E ratio except that it uses the forecast earnings instead. While this number might not be as accurate because it’s a future estimate, it does offer the benefit of illustrating analysts’ expectations of a firm. If the market believes that earnings will grow moving forward, then the forward P/E should be lower than the current P/E.

We first looked for consumer cyclical stocks trading at a premium (forward P/E > 20). From this narrowed list of candidates, we then looked for companies that have underperformed the SandP 500 over the last three months. We did not screen out any sectors or market caps.

The list is ranked from highest to lowest by the Forward P/E:

1. Amazon.com Inc. (NASDAQ:AMZN)

Sector

Consumer Cyclical

Industry

Specialty Retail

Market Cap

$97,095M

Beta

0.85

Click to enlarge

The company operates one of the largest online marketplaces in the world. The company has a forward P/E of 101.01 and has fallen by -4.05% in value over the last three months. The short interest was N/A as of 10/14/2011.

2. Stonemore Partners LP. (NYSE:STON)

Sector

Consumer Cyclical

Industry

Personal Services

Market Cap

$561M

Beta

0.80

Click to enlarge

The company is an owns and operates of cemeteries in the US. The company has a forward P/E of 89.29 and has fallen by 5.43% in value over the last three months. The short interest was N/A as of 10/14/2011.

3. Live Nation Entertainment, Inc. (NYSE:LYV)

Sector

Consumer Cyclical

Industry

Media - Diversified

Market Cap

$1,776M

Beta

2.15

Click to enlarge

The music company operates and promotes live concerts all over the world. The company has a forward P/E of 74.07 and has fallen by -15.41% in value over the last three months. The short interest was N/A as of 10/14/2011.

4. Toll Brothers Inc. (NYSE:TOL)

Sector

Consumer Cyclical

Industry

Residential Construction

Market Cap

$2,915M

Beta

1.19

Click to enlarge

The company designs, builds, and finances single-family detached and attached homes. The company has a forward P/E of 55.56 and has fallen by -12.63% in value over the last three months. The short interest was 9.50% as of 10/14/2011.

5. Netflix, Inc. (NASDAQ:NFLX)

Sector

Consumer Cyclical

Industry

Specialty Retail

Market Cap

$4,310M

Beta

0.65

Click to enlarge

The company offers a library of movies and TV shows through the mail and online. The company has a forward P/E of 44.44 and has fallen by -69.14% in value over the last three months. The short interest was N/A as of 10/14/2011.

6. Hyatt Hotels Corporation. (NYSE:H)

Sector

Consumer Cyclical

Industry

Lodging

Market Cap

$6,141M

Beta

N/A

Click to enlarge

The company has a forward P/E of 42.37 and has fallen by -4.12% in value over the last three months. The short interest was N/A as of 10/14/2011.

7. Clear Channel Outdoor Holdings. (NYSE:CCO)

Sector

Consumer Cyclical

Industry

Marketing Services

Market Cap

$3,915M

Beta

1.98

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The company offers advertising opportunities through a variety of displays. The company has a forward P/E of 41.32 and has fallen by -6.38% in value over the last three months. The short interest was 0.90% as of 10/14/2011.

8. Ryland Group, Inc. (NYSE:RYL)

Sector

Consumer Cyclical

Industry

Residential Construction

Market Cap

$600M

Beta

1.42

Click to enlarge

The company builds homes and offers mortgage financing. The company has a forward P/E of 39.53 and has fallen by -8.15% in value over the last three months. The short interest was 20.90% as of 10/14/2011.

9. Lululemon Athletica, Inc. (NASDAQ:LULU)

Sector

Consumer Cyclical

Industry

Apparel Stores

Market Cap

$6,145M

Beta

2.73

Click to enlarge

The company designs and retails of technical athletic apparel. The company has a forward P/E of 39.22 and has fallen by -6.71% in value over the last three months. The short interest was 18.50% as of 10/14/2011.

10. Orient-Express Hotels, Ltd. (OEH)

Sector

Consumer Cyclical

Industry

Lodging

Market Cap

$1,029M

Beta

3
Click to enlarge

The company operates a luxury hotel group. The company has a forward P/E of 39.06 and has fallen by -13.75% in value over the last three months. The short interest was 7.70% as of 10/14/2011.

We hope this list helps as investors do their own due diligence and research on high price-multiple consumer cyclical stocks.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.