Another destination that generally excels during Q3: shoe-seller DSW (DSW). Until 2011, the company’s third-quarter sales actually exceeded even those of the holiday season. In 2012, meanwhile, Q3 only lagged Q4 by around $2 million, yet led to almost double the earnings.
DSW boasted a strong first-quarter this year despite other weather complaints, beating analyst earnings expectations by an impressive 11%. Of course, the back-to-school headwind has less to do with matching styles to the season than with getting shoppers to shell out extra cash.
Regardless, that momentum has helped the stock rise of late, as DSW peaked at new all-time highs around $79 earlier this month and gained nearly 30% in the past 52 weeks.
The trouble: That actually makes the stock look a little frothy, touting a forward P/E of 18 vs. five-year annualized growth predictions of only 13%. With that in mind, it could only take a slight back-to-school slowdown for investors to reconsider.