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Three Consumer Stocks Show Warning Signs
Laureate Education, 1-800-FLOWERS, and H&R Block are flagged as consumer discretionary stocks facing potential trouble. Laureate Education reported underwhelming student enrollment and annual earnings per share growth of 4.2% that lagged revenue gains, while its free cash flow margin is not expected to expand. 1-800-FLOWERS saw sales decline 5.5% annually over five years and eroding returns on capital, suggesting recent investments are destroying value. H&R Block posted annual sales declines of 2.1% over five years and earnings per share growth of just 8.8% annually, underperforming its sector, with waning returns on capital indicating weakening profit engines.