Advertisements



Burlington Stores" (BURL) Q3 Earnings Top, Revenues Rise Y/Y

Burlington Stores (BURL) posts better-than-expected results for third-quarter fiscal 2021, driven by the solid execution of its Burlington 2.0 initiative. Shares of Burlington Stores, Inc. BURL have jumped 8.6% in the trading hours on Nov 23, following the robust third-quarter fiscal 2021 results. The top and the bottom line beat the Zacks Consensus Estimate and compared favorably with the respective year-ago tallies.Quarterly performance was primarily buoyed by the successful execution of the Burlington 2.0 initiative. Also, BURL’s store-related efforts, including smaller store prototype, have been on track for a while. In fact, new stores, including smaller store prototype, are performing impressively.Over the past six months, the stock has increased 2.4% compared with the industry's rally of 18.2%.Insight Into the HeadlinesBurlington Stores delivered adjusted earnings of $1.36 per share, surpassing the Zacks Consensus Estimate of $1.27. The bottom line also increased from the year-ago quarter’s reported figure of 29 cents per share but decreased from $1.53 recorded in third-quarter fiscal 2019.Total revenues of $2,304 million surged 38.2% year over year and 29.3% from the third-quarter fiscal 2019 figure. Net sales increased nearly 30% from the third-quarter fiscal 2019 number to $2,300 million while Other revenues decreased 33.3% to $4.4 million. The Zacks Consensus Estimate stood below at $2,285 million for the reported quarter.Burlington Stores, Inc. Price, Consensus and EPS Surprise Burlington Stores, Inc. price-consensus-eps-surprise-chart | Burlington Stores, Inc. QuoteComparable-store sales (comps) grew 16% from the third-quarter fiscal 2019 reading. Solid pent-up demand coupled with the residual impacts of the federal stimulus payments distributed in March and gains from the robust execution of the 2.0 strategy aided comps. Burlington Stores’ entire key merchandise categories comfortably outperformed their expectations and comp-store sales across all regions of the country performed impressively.MarginsGross margin was 41.4% in the reported quarter, down 100 basis points (bps) from the third-quarter fiscal 2019 actuals. Merchandise margins grew 80 bps, more than offset by a 180-bps rise in freight expense. Also, increased supply-chain costs were deterrents.Adjusted EBITDA rose 6.5% from the third-quarter fiscal 2019 tally to $205 million. The metric also showed an increase from adjusted EBITDA of $113.5 million recorded in the third quarter of fiscal 2020.Adjusted EBIT was flat with the figure registered in the third quarter of fiscal 2019 at $140.3 million. The metric also showed a sharp jump from adjusted EBIT of $58.6 million during the third quarter of fiscal 2020. Adjusted EBIT margin fell 120 bps from the third-quarter fiscal 2019 finals.Other Financial AspectsThis presently Zacks Rank #3 (Hold) Burlington Stores ended the reported quarter with cash and cash equivalents of $1,185.4 million, long-term debt of $1,614.6 million and stockholders’ equity of $716.8 million. It exited the fiscal third quarter with $1,726 million of liquidity, including $1,185 million of unrestricted cash and $541 million available under its ABL facility.Burlington Stores ended the quarter with $1,629 million of outstanding total debt, which comprises $953 million under its Term Loan Facility, $645 million of Convertible Notes and no borrowings under its ABL Facility.Merchandise inventories were $1059.7 million, up 5.6% from the third-quarter fiscal 2019 tally. Comparable store inventories fell 24% from the level recorded in the same quarter of fiscal 2019. Reserve inventory accounted for 30% of the total inventory at the end of the reported quarter.Burlington Stores bought back 512,363 shares for $150 million under its share repurchase plan in the fiscal third quarter. As of Oct 30, 2021, it had $250 million remaining under the existing share repurchase authorization.During the reported quarter, Burlington Stores opened 40 net stores, raising the store count to 832. In the fiscal fourth quarter, it inaugurated additional eight stores and anticipates closing two outlets. In fiscal 2021, it projects to open 101 stores and relocate or shut down 24 outlets. This will add up to 77 net new outlets in the current fiscal year.OutlookManagement did not provide any specific sales and earnings view for fiscal 2021 (the 52 weeks ending Jan 29, 2022) due to the prevalent pandemic uncertainty and the pace of recovery of customer demand. Burlington Stores anticipates witnessing significant freight and supply-chain cost pressures through the fiscal fourth quarter.For the fiscal fourth quarter, management now projects comp sales to grow in the low double-digit percentage range. Moving forward, BURL expects quite a favorable buying environment. At the end of the fiscal fourth quarter, in-store inventories are likely to be down in the mid-30% range. It forecasts a deleveraged operating margin of 250 bps during the impending quarter.For fiscal 2021, management anticipates the operating margin to be flat with the 2019 tally. It expects about 360-bps deleveraged freight and supply-chain expenses with 350 bps of offsetting higher merchant margin and greater leveraged SG&A expenses.Capital expenditures, net of landlord allowances for fiscal 2021, are likely to be roughly $425 million.Stocks to ConsiderWe highlighted three better-ranked stocks in the Retail - Wholesale sector, namely Boot Barn Holdings BOOT, Tractor Supply Company TSCO and Target TGT. Boot Barn Holdings, the lifestyle retailer of western and work-related footwear, apparel and accessories, sports a Zacks Rank #1 (Strong Buy), currently. Shares of BOOT have jumped 66.4% in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here. The Zacks Consensus Estimate for Boot Barn Holdings’ current-year sales and earnings per share (EPS) suggests growth of 54.4% and 183.3%, respectively, from the corresponding year-ago period’s reported figures. BOOT has a trailing four-quarter earnings surprise of 35.3%, on average. Tractor Supply Company, a rural lifestyle retailer in the United States, flaunts a Zacks Rank of 1 at present. TSCO has a trailing four-quarter earnings surprise of 22.8%, on average. The stock has rallied 23.4% in the past six months. The Zacks Consensus Estimate for Tractor Supply Company’s current-year sales and EPS suggests growth of 19% and 23.9%, respectively, from the corresponding year-ago period’s reported numbers. TSCO has an expected EPS growth rate of 9.6% for three-five years. Target, a renowned omni-channel retailer, presently carries a Zacks Rank #2 (Buy). TGT has a trailing four-quarter earnings surprise of 19.7%, on average. The stock has surged 9.6% in the past six months. The Zacks Consensus Estimate for Target’s current-year sales and EPS suggests growth of 14% and 39.6%, respectively, from the corresponding year-ago period’s levels. TGT has an expected EPS growth rate of 14.4% for three-five years. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Target Corporation (TGT): Free Stock Analysis Report Tractor Supply Company (TSCO): Free Stock Analysis Report Boot Barn Holdings, Inc. (BOOT): Free Stock Analysis Report Burlington Stores, Inc. (BURL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 25th, 2021

lululemon (LULU) to Report Q3 Earnings: Is a Beat in Store?

lululemon's (LULU) Q3 results are expected to reflect gains from store traffic revival, continued digital momentum, improved store productivity, and robust gross margin. lululemon athletica inc. LULU is likely to witness top and bottom-line growth when it reports third-quarter fiscal 2021 results on Dec 9, after market close. The Zacks Consensus Estimate for fiscal third-quarter sales is pegged at $1.43 billion, indicating a 28.1% increase from the prior-year quarter's reported figure.The Zacks Consensus Estimate for the company's fiscal third-quarter earnings stands at $1.39, suggesting a 19.8% rise from $1.16 reported in the year-ago quarter. Earnings estimates have moved up by a penny in the past 30 days.The company delivered an earnings surprise of 25.2% in the last reported quarter. LULU's bottom line beat estimates by 36.4%, on average, in the trailing four quarters.lululemon athletica inc. Price and EPS Surprise  lululemon athletica inc. price-eps-surprise | lululemon athletica inc. QuoteKey Factors to Notelululemon's quarterly performances have been benefiting from a positive response for its products, improved store productivity and continued digital momentum. Strength across all categories, channels and geographies has been aiding results. A rebound in brick-and-mortar sales, driven by an increase in store traffic as consumers return to stores for shopping, as well as continued expansion in the e-commerce channel have been the drivers. The factors are expected to have aided the company's top and bottom lines in the to-be-reported quarter.On the last reported quarter's earnings call, management noted that its strong business momentum continued in the second half of fiscal 2021. For third-quarter fiscal 2021, the company predicted net sales of $1.4-$1.43 billion, indicating two-year CAGR growth of 24-25%. Adjusted earnings are anticipated to be $1.33-$1.38 per share, whereas LULU reported $1.16 in the prior-year quarter and 96 cents in third-quarter fiscal 2019.Continued investments to enhance the in-store experience are likely to have bolstered sales and earnings in the fiscal third quarter. lululemon is leveraging its stores to facilitate omni-channel capabilities, including the buy online pickup in store and ship-from-store. It has implemented several strategies to improve the guest experience and reduce wait time, including virtual waitlist, mobile POS and appointment shopping. The functionalities have enabled reducing the time of waiting in line to enter stores as well as allowing customers to complete some transactions like returns, exchanges and purchase of gift cards without entering stores.Management anticipates gross margin expansion of 50-100 bps for the fiscal third quarter from that reported in third-quarter fiscal 2019. Gross margin growth from the fiscal 2019 comparable period can be attributed to higher e-commerce penetration, and occupancy and depreciation cost leverage.The company's fiscal third-quarter gross margin is likely to have reflected continued gains from leverage in occupancy, product team costs and depreciation. On the last reported quarter's earnings call, management expected third-quarter fiscal 2021 gross margin to expand 50-100 bps from that reported in third-quarter fiscal 2019. Gross margin growth from the fiscal 2019 comparable period can be attributed to higher e-commerce penetration, and occupancy and depreciation cost leverage.However, industry-wide supply-chain challenges, stemming from the pandemic-led factory closures, congestion at ports and reduced airfreight capacity, remain concerning. On the last reported quarter's earnings call, management expected supply-chain challenges, driven by the pandemic-led factory closures, congestion at ports and reduced airfreight capacity, to impact its business in the second half of fiscal 2021. The company's gross margin guidance for third-quarter fiscal 2021 includes a 200-bps impact of higher airfreight costs, owing to port congestion and capacity constraints.lululemon is also facing SG&A deleverage on a two-year basis, which is likely to have continued in the fiscal third quarter. The company expected SG&A expenses for the third quarter of fiscal 2021 to deleverage 300-350 bps from the pre-pandemic levels. The deleverage mainly relates to higher depreciation due to accelerated investments to support the e-commerce business in 2020 and 2021, consolidation of MIRROR's results this year, and increased investments in brand-building for its growth initiative.What the Zacks Model UnveilsOur proven model conclusively predicts an earnings beat for lululemon this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.lululemon has a Zacks Rank #2 and an Earnings ESP of +1.44%.Other Stocks Likely to Beat Earnings EstimatesHere are some other companies that you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat.Costco Wholesale COST currently has an Earnings ESP of +0.88% and a Zacks Rank of 3. The company is expected to register top and bottom-line growth when it reports first-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for COST's quarterly revenues is pegged at $49.6 billion, which suggests growth of 14.8% from the prior-year quarter's reported figure.You can see the complete list of today's Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Costco's quarterly earnings moved up 2% in the last 30 days to $2.59 per share, suggesting 13.1% growth from the year-ago reported number. COST has delivered an earnings beat of 7.7%, on average, in the trailing four quarters.Vail Resorts MTN currently has an Earnings ESP of +5.46% and a Zacks Rank #3. MTN is anticipated to register top-line growth when it reports third-quarter fiscal 2021 results. The Zacks Consensus Estimate for the quarterly revenues is pegged at $195.1 million, indicating an improvement of 48.1% from the figure reported in the prior-year quarter.The Zacks Consensus Estimate for Vail Resorts' bottom line has improved significantly in the past 30 days to a loss of $3.66 per share. However, the consensus estimate suggests wider loss per share compared with $3.63 reported in the year-ago quarter. MTN has delivered an earnings beat of 17.3%, on average, in the trailing four quarters.Dave & Buster's Entertainment PLAY currently has an Earnings ESP of +13.04% and a Zacks Rank #3. PLAY is likely to register top and bottom-line growth when it reports third-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for its quarterly revenues is pegged at $320.5 million, which suggests growth of 193.9% from the figure reported in the prior-year quarter.The Zacks Consensus Estimate for Dave & Buster's quarterly earnings has moved up 20% in the past seven days to 12 cents per share, suggesting substantial growth from a loss of $1.01 reported in the year-ago quarter. PLAY has delivered an earnings beat of 201.8%, on average, in the trailing four quarters. Zacks' Top Picks to Cash in on Artificial Intelligence In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Costco Wholesale Corporation (COST): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis Report Vail Resorts, Inc. (MTN): Free Stock Analysis Report Dave & Buster's Entertainment, Inc. (PLAY): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksDec 3rd, 2021

Domino"s (DPZ) Outpaces Industry in the Past 6 Months: Here"s Why

Domino's (DPZ) is benefiting from a solid digital ordering system and higher global retail sales. The restaurant industry has been grappling with traffic decline over the past six months. However, shares of Domino's Pizza, Inc. DPZ have surged 22.2% in the same time frame, against the industry’s decline of 3.1%. The company has been benefiting from a solid digital ordering system and higher global retail sales. This along with focus on robust international expansion bodes well. However, coronavirus woes and high debt remain concerns. Let’s delve deeper.Factors Driving GrowthDomino's continues to benefit from high digital ordering. During the second quarter of 2020, the company-initiated car-side delivery, thus enabling convenient and contact-free carryout experience for its customers. During the third quarter fiscal 2021, the company made substantial progress regarding its Carside Delivery. With consistent waiting time averaging below two minutes, franchisees and operators have enthusiastically embraced this new service method. It was also successful in bringing in new customers. During the quarter, the company initiated a pilot version of its new Pulse point-of-sale system to bolster the productivity of its stores. Given the ongoing development and evolution of the product, further investments in this direction are likely.Meanwhile, the company’s international growth continues to be strong and diversified across markets, courtesy of exceptional unit level economics. Third-quarter fiscal 2021 marked the 111th consecutive quarter of positive same-store sales in its international business. Improvement in comps can be attributed to ticket growth. This was driven by the return of non-delivery service methods, the resumption of normal store hours and the reopening of international stores (that were closed in the prior-year quarter). Meanwhile, the company inaugurated 323 (45 net U.S. stores and 278 net new international stores) global net store openings during third-quarter fiscal 2021.During the fiscal third quarter, the company accelerated the pace of global store growth on a trailing four-quarter basis. It has opened 1124 net new stores, which shows an increase of 500 from fourth-quarter 2020. Solid store openings were witnessed in India, with the count rising to 1400. The company initiated its 93rd international market with a store opening in Lithuania. Going forward, the company is confident about its two to three-year outlook of 6% to 8% annual global net store growth.The Zacks Rank #3 (Hold) company continues to impress investors with robust margin growth. In third-quarter fiscal 2021, the company’s operating margin expanded 120 basis points (bps) year over year to 38.6% compared with 37.4% in the prior-year period. Operating margin expansion was primarily driven by an increase in revenues in its global franchise business. Net income margin for the quarter was 12.1%, up 190 bps from the prior-year level. However, company-owned store margin (as a percentage of revenues) was flat year over year at 19.8%.Image Source: Zacks Investment ResearchConcernsAt the end of third-quarter fiscal 2021, fewer than 175 stores (majority located in India and New Zealand) were temporarily shut due to the pandemic. During the quarter, COVID-19 continues to have a significant impact on several of the company’s international markets. The company announced that coronavirus pandemic will continue to hurt international markets for the upcoming quarters.Managing liquidity has become a herculean task during the coronavirus pandemic. Long-term debt, as of Sep 12, 2021, was $5 billion, almost flat sequentially. The company ended the fiscal third quarter with cash and cash equivalent of $295.4 million compared with $292.1 million in the previous quarter. Although cash and cash equivalent has increased sequentially, it might still be difficult to manage a high debt level.Key Restaurant PicksPapa John's International, Inc. PZZA currently carries a Zacks Rank #2 (Buy). The company has been benefiting from its off-premise business model. Sales at off-premise business model has exceeded pre-pandemic levels. We believe that a rise in customer count coupled with targeted off-premise marketing are likely to drive the channel’s performance in the days ahead.Papa John's has reported better-than-expected earnings in three of the trailing four quarters, the average surprise being 27.2%. The company’s fiscal 2021 earnings is likely to witness growth of 138.6%. PZZA stock has gained 48.2% in the past year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Del Taco Restaurants, Inc. TACO has a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 25.7%, on average. Shares of the company have gained 3.3% in the past three months.The Zacks Consensus Estimate for Del Taco Restaurants’ current financial year sales and earnings per share suggests improvement of 7.2% and 33.3%, respectively, from the year-ago period.Kura Sushi USA, Inc. KRUS carries a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 15.6%, on average. Shares of the company have soared 225.1% in the past year.The Zacks Consensus Estimate for Kura Sushi’s current financial-year sales and EPS suggests growth of 108% and 85.7%, respectively, from the year-ago period’s levels. Zacks' Top Picks to Cash in on Artificial Intelligence In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Domino's Pizza Inc (DPZ): Free Stock Analysis Report Papa John's International, Inc. (PZZA): Free Stock Analysis Report Del Taco Restaurants, Inc. (TACO): Free Stock Analysis Report Kura Sushi USA, Inc. (KRUS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksDec 3rd, 2021

Rent-A-Center (RCII) Down 0.7% Since Last Earnings Report: Can It Rebound?

Rent-A-Center (RCII) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues. A month has gone by since the last earnings report for Rent-A-Center (RCII). Shares have lost about 0.7% in that time frame, outperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Rent-A-Center due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Rent-A-Center Q3 Earnings Beat, Revenues Grow Y/YRent-A-Center posted sturdy third-quarter 2021 results wherein both the top and the bottom line surpassed the Zacks Consensus Estimate and improved on a year-over-year basis.Q3 in DetailRent-A-Center posted adjusted earnings of $1.52 a share that beat the Zacks Consensus Estimate of $1.47. Also, the bottom line rose 46.2% from $1.04 earned in the year-ago quarter.Consolidated total revenues of $1,181 million surpassed the Zacks Consensus Estimate of $1,176 million and surged 65.9% year over year. Growth was mainly driven by gains from the buyout of Acima Holdings and same-store sales growth in the Rent-A-Center Business segment. On a pro-forma basis, revenues rose 13% on solid organic growth in the Acima and Rent-A-Center Business units.We note that adjusted EBITDA came in at $170.2 million, up 4.1% from the year-ago period’s level on a pro-forma basis. However, adjusted EBITDA margin declined 130 basis points to 14.4%, mainly due to normalization in the customer payment activity as well as loss rates from the wind down of government stimulus, supply-chain headwinds and a mix shift to the high- growth Acima business.Segment PerformanceRevenues at the Rent-A-Center Business segment rose 5.6% to $501 million, mainly owing to same-store sales growth of 12.3%, led by a 9% increase in e-commerce sales and a solid lease portfolio performance. Growth was partly offset by the impacts of refranchising nearly 100 stores in California during the fourth quarter of 2020.Revenues at the Acima segment (formerly known as the Preferred Lease segment) surged 209% from the prior-year quarter’s level to $623.5 million, mainly buoyed by the gains from the Acima buyout. On a pro-forma basis, revenues rose 17% while gross merchandise volume (GMV) improved 19%, driven by a higher number of merchants and active customers.Mexico segment’s revenues totaled $15.9 million, up 18.5% on a constant-currency basis. Also, the segment’s same-store sales rose 15.3%.Finally, Franchising revenues jumped 70.7% to $40.9 million. This can primarily be attributed to an increased store count resulting from the refranchising of California stores during 2020 and a rise in inventory purchases by franchisees.Other Financial AspectsRent-A-Center ended the reported quarter with cash and cash equivalents of $158.8 million, net senior debt of $846.1 million and a stockholders' equity of $854.1 million. It had an outstanding debt of $1.3 billion at the quarter end. The company ended the quarter with $622 million of liquidity including $464 million of undrawn revolving credit.Capital expenditures totaled $20.5 million in the three months ended Sep 30. The company generated cash of $326.2 million from operations and a negative free cash flow including acquisitions and divestitures of $993.2 million during the nine months ended Sep 30.During the reported quarter, management returned $38 million to the company’s shareholders including $18 million of dividends and $20 million of share repurchases. Year to date through October, it bought back shares worth $80 million. At the end of October, the company had roughly $170 million available under the existing share repurchase authorization.2021 OutlookConsolidated revenues are now projected in the bracket of $4.550-$4.640 billion for 2021 compared with $4.550-$4.670 billion predicted earlier. Rent-A-Center delivered $2.814 billion in 2020. Adjusted EBITDA is now forecast between $645 million and $675 million compared with the previous projection of $660-$700 million.Adjusted earnings per share are now envisioned in the band of $5.90-$6.15 compared with $5.90-$6.40 expected earlier. The latest guidance suggests growth from $3.53 earned last year.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in estimates review. The consensus estimate has shifted -10.23% due to these changes.VGM ScoresAt this time, Rent-A-Center has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Rent-A-Center has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months. Zacks' Top Picks to Cash in on Artificial Intelligence In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report RentACenter, Inc. (RCII): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksDec 3rd, 2021

Here"s Why Hold Strategy is Apt for Ralph Lauren (RL) Now

Ralph Lauren (RL) is poised for growth in the long term, owing to its growth initiatives, digital momentum, and investment in omni-channel and technological capabilities. Ralph Lauren Corporation RL has been displaying resilience amid a challenging environment, backed by its business strategies, including the Next Great Chapter plan and continued digital momentum. The company has been witnessing continued momentum across all regions, driven by improved assortments, expanded capabilities and marketing efforts. Its robust surprise trend has been bolstering investors' sentiments.The company has a trailing four-quarter earnings surprise of 86%, on average. The beat streak instills further investor confidence in the stock. In second-quarter fiscal 2022, the company reported the fifth straight earnings beat and the third consecutive revenue surprise. Earnings and revenues also improved year over year.The results gained from solid performance across all regions, mainly Europe and North America. The Asia region also contributed to quarterly growth, driven by strength in China and Korea. Robust performances in casual bottoms, sweaters and fleece along with high potential in underdeveloped categories — particularly denim, accessories and home — bode well.In the past 30 days, estimates for the company's fiscal 2022 and 2023 earnings per share have moved up 4.1% and 1.4%, respectively. For fiscal 2022, RL's earnings estimates stand at $7.32 per share, suggesting growth of 330.6% from the year-ago reported figure.Shares of the Zacks Rank #3 (Hold) company have rallied 30.5% in the past year compared with the industry's growth of 21.8%. It also compares favorably against the Consumer Discretionary sector's decline of 4% and the Zacks S&P Composite's growth of 27.6%. Image Source: Zacks Investment Research Factors Supporting GrowthRalph Lauren has been making significant progress in expanding digital and omni-channel capabilities through investments in mobile, omni-channel and fulfillment. In second-quarter fiscal 2022, the digital business continued to be a key growth driver, with accelerated digital sales across all regions. The global digital ecosystem sales advanced 45%, while owned digital e-commerce rose more than 35% year over year despite the gradual return of traffic to stores.The company's digital investments continue to remain focused on creating content for all platforms, enhancing digital capabilities to improve the user experience, and continuing to leverage Artificial Intelligence (AI) and data management to serve its consumers more efficiently.In the fiscal second quarter, the company, in association with Zepeto, launched its first digital apparel collection. It also introduced the exclusive Next-Generation-focused capsules for Urban Outfitters and ASOS as well as a new Ralph's Club fragrance. Ralph Lauren started its second digital-forward Emblematic retail concept in Shanghai.Ralph Lauren is also on track to exceed its top and bottom-line targets under the "Next Great Chapter" plan announced in June 2018. Later, it announced measures to accelerate its "Next Great Chapter plan," which includes creating a simplified global organizational structure and rolling out improved technological capabilities. As part of the plan, RL completed the transition of Chaps to a licensed business, thus, concluding its portfolio realignment announced last year. The move will likely enable Ralph Lauren to focus on core brands as part of the Next Great Chapter elevation strategy.The company envisions delivering low to mid-single-digit revenue compounded annual growth rate (CAGR) and a mid-teen operating margin by fiscal 2023 in constant currency. It anticipates marketing spend growth of 5% of revenues by fiscal 2023, while capital expenditure is expected to represent 4-5% of revenues. The company plans to return 100% free cash flow to shareholders in the next five years, amounting to $2.5 billion on a cumulative basis through fiscal 2023 in the forms of dividends and share repurchases.Backed by the impressive second-quarter fiscal 2022 results and signs of recovery across all markets, Ralph Lauren raised its fiscal 2022 view. The company expects constant-currency revenue growth of 34-36% for fiscal 2022, up from the earlier mentioned 25-30%. The operating margin is anticipated to be 12-12.5% compared with 4.8% and 10.3% reported in fiscal 2021 and 2020, respectively. The gross margin is still envisioned to expand 50-70 bps, driven by average unit retail growth and positive product mix, which are expected to more than offset higher freight costs.For third-quarter fiscal 2022, revenues are anticipated to rise 14-16% year over year at constant currency, with a favorable currency impact of 140 bps. The operating margin is forecast to be 13-13.5%, with a slight expansion in the gross margin. This is mainly due to the shift in the timing of investments from the fiscal second quarter to the third, higher freight costs, normalizing of the channel mix shift and foreign-currency headwinds of 30 bps.Roadblocks AheadRalph Lauren continues to witness elevated marketing expenses, owing to the reactivation of in-person activities, and high-impact digital campaigns and personalization. In second-quarter fiscal 2022, marketing investments surged 83% year over year. Marketing investments rose 27% from second-quarter fiscal 2020 due to customer acquisitions and digital brand campaigns.RL expects marketing investments to remain elevated in fiscal 2022, at nearly 6% of sales, to support consumer engagement, acquisition and long-term brand-building initiatives. Adjusted operating expenses increased 17% from the year-ago period to $755 million for the fiscal second quarter, driven by compensation and higher marketing investments. Operating expenses are likely to be higher in the second half of fiscal 2022 due to increased marketing and other investments.The company is also witnessing higher freight costs, which are weighing on the gross margin performance. In second-quarter fiscal 2022, the adjusted gross margin included freight headwinds of roughly 150 bps. Although Ralph Lauren provided a robust margin view for fiscal 2022, it expects margins to be offset by the persistence of certain costs, including global supply-chain pressures, higher freight costs and marketing investments.The company's gross margin view for fiscal 2022 includes slightly higher freight headwinds of 130-150 bps versus the previously mentioned 100-120 bps. This is likely to partly offset gross margin growth. RL predicts higher freight costs for the second half of fiscal 2022 and normalizing of the channel mix shift compared with last year's COVID disruptions. RL also expects the highly volatile and inflationary input cost environment to continue in fiscal 2022.Stocks to WatchWe have highlighted some better-ranked stocks from the same industry, namely Guess GES, Delta Apparel DLA and Gildan Activewear GIL.Guess currently sports a Zacks Rank #1 (Strong Buy). The company has a trailing four-quarter earnings surprise of 97%, on average. Shares of GES have surged 33.6% in the past year.You can see the complete list of today's Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Guess' current financial-year sales suggests growth of 38.6% and the same for earnings per share reflects substantial growth from the year-ago period's reported figure.Delta Apparel, a Zacks Rank #1 stock at present, has a trailing four-quarter earnings surprise of 95.5%, on average. The DLA stock has gained 38.2% in a year's time.The Zacks Consensus Estimate for Delta Apparel's current financial-year sales and earnings per share suggests growth of 11.6% and 9.4%, respectively, from the year-ago period's reported numbers.Gildan Activewear currently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 85%, on average. Shares of GIL have gained 52.2% in the past year.The Zacks Consensus Estimate for Gildan Activewear's current financial-year sales suggests growth of 43.6% and the same for earnings per share reflects substantial growth from the year-ago period. GIL has an expected long-term earnings growth rate of 9%. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Ralph Lauren Corporation (RL): Free Stock Analysis Report Guess, Inc. (GES): Free Stock Analysis Report Gildan Activewear, Inc. (GIL): Free Stock Analysis Report Delta Apparel, Inc. (DLA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksDec 1st, 2021

Ollie"s Bargain (OLLI) to Post Q3 Earnings: What to Expect

Ollie's Bargain's (OLLI) third-quarter results are likely to reflect supply chain pressure, higher transportation expenses and labor costs Ollie's Bargain Outlet Holdings, Inc. OLLI is likely to register a decrease in the top line when it reports third-quarter fiscal 2021 numbers on Dec 2, after the market closes. The Zacks Consensus Estimate for revenues is pegged at $410.1 million, indicating a decline of 1% from the prior-year quarter.The bottom line of this extreme value retailer of brand name merchandise is expected to decline year over year. We note that the Zacks Consensus Estimate for third-quarter earnings per share has been stable at 47 cents over the past 30 days. The figure suggests a decline from earnings of 65 cents reported in the year-ago period.The company has a trailing four-quarter earnings surprise of 9.7%, on average. In the last reported quarter, this Harrisburg, PA-based company’s bottom line missed the Zacks Consensus Estimate by 8.8%.Key Factors to NoteOllie's Bargain third-quarter performance is likely to have witnessed tough year-over-year comparisons in sales, as COVID-19 benefits are lapped. On its last earnings call, management highlighted that the company’s third-quarter comp sales comparisons will be challenging owing to impressive performance last year as the top line gained from stimulus measures.Again, ongoing supply chain pressure, higher transportation expenses and labor costs might have weighed on the margins. The company has been witnessing deleverage in SG&A expense for quite some time now due to an increase in the number of stores.Nonetheless, the company’s operating model of “buying cheap and selling cheap”, cost-containment efforts, focus on store productivity and expansion of customer reward program — Ollie's Army might have provided some cushion. It has been making an effort to create an alignment between value driven merchandise and customer demand.Ollie's Bargain Outlet Holdings, Inc. Price, Consensus and EPS Surprise Ollie's Bargain Outlet Holdings, Inc. price-consensus-eps-surprise-chart | Ollie's Bargain Outlet Holdings, Inc. QuoteWhat the Zacks Model UnveilsOur proven model does not conclusively predict an earnings beat for Ollie's Bargain this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. You can see the complete list of today’s Zacks #1 Rank stocks here.Ollie's Bargain carries a Zacks Rank #3 and has an Earnings ESP of 0.00%.3 Stocks With Favorable CombinationHere are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:lululemon athletica LULU currently has an Earnings ESP of +1.44% and a Zacks Rank of 2. The company is expected to register top and bottom line growth when it reports third-quarter fiscal 2021 numbers. The Zacks Consensus Estimate for LULU’s quarterly revenues is pegged at $1.43 billion, which suggests growth of 28.1% from the prior-year quarter.The Zacks Consensus Estimate for lululemon’s quarterly earnings moved up by a penny in the last 30 days to $1.39 per share, suggesting a 19.8% increase from the year-ago reported number. LULU has a trailing four-quarter earnings surprise of 25.2%, on average.Kroger KR currently has an Earnings ESP of +1.06% and a Zacks Rank #3. The company is expected to register bottom-line decline when it reports third-quarter fiscal 2021 results. The Zacks Consensus Estimate for quarterly earnings of 67 cents a share suggests decline of 5.6% from the year-ago quarter’s reported figure.Kroger’s top line is expected to rise year over year. The consensus mark for revenues is pegged at $31.15 billion, indicating an improvement of 4.8% from the year-ago quarter. KR has a trailing four-quarter earnings surprise of 18%, on average.Campbell Soup CPB currently has an Earnings ESP of +0.71% and a Zacks Rank #3. The company is expected to register bottom-line decline when it reports first-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings of 80 cents a share suggests decline of 21.6% from the year-ago quarter’s reported figure.Campbell Soup’s top line is expected to decrease year over year. The consensus mark for revenues stands at $2.29 billion, indicating a decline of 2.1% from the figure reported in the year-ago quarter. CPB has a trailing four-quarter earnings surprise of 4.2%, on average. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Kroger Co. (KR): Free Stock Analysis Report Campbell Soup Company (CPB): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis Report Ollie's Bargain Outlet Holdings, Inc. (OLLI): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksDec 1st, 2021

Ulta Beauty (ULTA) Queued for Q3 Earnings: Things to Note

Ulta Beauty's (ULTA) third-quarter fiscal 2021 performance is likely to reflect strength in the skincare category and e-commerce operations. Ulta Beauty, Inc. ULTA is likely to register top-and bottom-line growth when it reports third-quarter fiscal 2021 numbers on Dec 2. The Zacks Consensus Estimate for quarterly revenues is pegged at $1,895 million, which suggests a rise of 22.1% from the figure reported in the prior-year quarter.The Zacks Consensus Estimate for Ulta Beauty’s quarterly earnings has moved up by a penny in the past 30 days to $2.47 per share. The projection suggests 50.6% growth from the year-ago quarter’s reported figure. The retailer of beauty products has a trailing four-quarter earnings surprise of 63.9%, on average. Ulta Beauty’s bottom line has outpaced the Zacks Consensus Estimate by 83.1% in the last reported quarter.Ulta Beauty Inc. Price and EPS Surprise  Ulta Beauty Inc. price-eps-surprise | Ulta Beauty Inc. Quote Things To NoteUlta Beauty is benefiting from the growing skincare category, thanks to consumers’ rising interest in self-care and the company’s focus on newness and innovation. In its last earnings call, management highlighted its intentions to re-launch the skin services in certain stores during third-quarter fiscal 2021. Apart from this, Ulta Beauty has been benefiting from its omnichannel strength.The company’s initiatives to boost online promotions and customer engagement have been supporting online sales growth. The company is also benefiting from its mobile app and virtual try-on capabilities. These factors are likely to have boosted Ulta Beauty’s performance in the to-be-reported quarter.Softness in the makeup category is a concern for Ulta Beauty. That being said, the category is seeing better trends with reduced mask-wearing and increased use of makeup. Apart from this, any rise in SG&A costs might have impacted margins in the fiscal third quarter.What the Zacks Model UnveilsOur proven model predicts an earnings beat for Ulta Beauty this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Ulta Beauty currently carries a Zacks Rank #3 and has an Earnings ESP of +0.63%.More Stocks With Favorable CombinationsHere are some more companies that you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat.PVH Corp. PVH currently has an Earnings ESP of +1.61% and a Zacks Rank #2. The company is expected to register bottom-line growth when it reports third-quarter fiscal 2021 results. The Zacks Consensus Estimate for quarterly earnings has moved up by a penny in the past seven days to $2.07 per share. The projection suggests a rise of 56.8% from the year-ago quarter’s reported figure. You can see the complete list of today’s Zacks #1 Rank stocks here.PVH Corp.’s top line is expected to rise year over year. The consensus mark for revenues is pegged at $2,402 million, indicating an increase of 13.4% from the figure reported in the year-ago quarter. PVH has a trailing four-quarter earnings surprise of 177.5%, on average.Costco Wholesale Corporation COST currently has an Earnings ESP of +1.00% and a Zacks Rank #3. The company is expected to register bottom-line growth when it reports first-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings has moved up 2.8% in the past 30 days to $2.59 per share. The projection suggests growth of 13.1% from the year-ago quarter’s reported figure.Costco’s top line is also expected to rise year over year. The consensus mark for revenues is pegged at $49,613 million, indicating an increase of 14.8% from the figure reported in the year-ago quarter. COST has a trailing four-quarter earnings surprise of 7.7%, on average.The Kroger Co. KR currently has an Earnings ESP of +2.59% and a Zacks Rank of 3. It is likely to register a bottom-line decline when it reports third-quarter fiscal 2021 numbers. Although the Zacks Consensus Estimate for quarterly earnings has increased by a penny in the past 30 days to 66 cents per share, the same suggests a decline of about 7% from the year-ago period’s tally.Kroger’s top line is likely to register year-over-year growth in the quarter. The Zacks Consensus Estimate for its quarterly revenues is pegged at $31,148 million, suggesting an increase of 4.8% from the figure reported in the prior-year quarter. KR delivered an earnings surprise of 18%, on average, in the trailing four quarters. Investor Alert: Legal Marijuana Looking for big gains? Now is the time to get in on a young industry primed to skyrocket from $13.5 billion in 2021 to an expected $70.6 billion by 2028. After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could kick start an even greater bonanza for investors. Zacks Investment Research has recently closed pot stocks that have shot up as high as +147.0% You’re invited to immediately check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.Today, Download Marijuana Moneymakers FREE >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Kroger Co. (KR): Free Stock Analysis Report Costco Wholesale Corporation (COST): Free Stock Analysis Report Ulta Beauty Inc. (ULTA): Free Stock Analysis Report PVH Corp. (PVH): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 29th, 2021

Aaron"s (AAN) Up 7.4% Since Last Earnings Report: Can It Continue?

Aaron's (AAN) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues. It has been about a month since the last earnings report for Aaron's Company, Inc. (AAN). Shares have added about 7.4% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Aaron's due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts. Aaron's Tops Q3 Earnings & Revenues Estimates, Ups ViewAaron's reported impressive third-quarter 2021 results, wherein the top and bottom lines beat the Zacks Consensus Estimate. The company has strengthened its position in the direct-to-consumer lease-to-own market. The solid e-commerce business and sturdy performance in GenNext stores also aided quarterly results. Management raised its 2021 view.It remains on track with its GenNext real estate strategy, which is performing well. As of Sep 30, 2021, Aaron’s boasts 86 GenNext stores. The company expects to open more than 100 such stores by 2021.Q3 HighlightsAaron's delivered adjusted earnings of 83 cents per share, which surpassed the Zacks Consensus Estimate of 53 cents. However, the bottom line declined 25% year over year from $1.10 per share reported in the prior-year quarter. On a GAAP basis, the company recorded earnings of 73 cents per share, down 24% year over year from 96 cents reported in the year-ago quarter.Consolidated revenues rose 2.5% to $452.2 million and beat the Zacks Consensus Estimate of $434 million. The uptick is mainly due to improved quality and the size of its lease portfolio, which somewhat offset reduced customer payment activities, and the impact of the net closure of 79 franchised stores in 15 months ended Sep 30, 2021.Same-store revenues rose 4.6% in the third quarter, driven by a robust lease portfolio, which somewhat offset reduced payment activities. E-commerce lease revenues were up 13.3%, accounting for 14.3% of total revenues.Breaking up the components of consolidated revenues, we note that lease and retail revenues grew 4% in the reported quarter to $413.7 million. Non-retail sales, which mainly include merchandise sales to franchisees, fell 7.6% year over year. Franchise royalties and fees in the quarter slumped 24.7% to $6.3 million from the year-ago quarter.Aaron’s franchisee revenues decreased 21.2% year over year to $79.8 million on reduced franchised locations. Meanwhile, same-store revenues for franchised stores grew 2.1% year over year. Revenues and customers of franchisees are not deemed as revenues and customers of the company.Aaron’s adjusted EBITDA declined 16.6% year over year to $53.6 million from $64.3 million reported in the year-ago quarter. Adjusted EBITDA margin contracted 270 basis points (bps) to 11.9% in the reported quarter due to reduced customer payment activity and a potential rise in write-offs.Financial PositionThe company ended the quarter with cash and cash equivalents of $14.8 million, and shareholders’ equity of $721.5 million. As of Sep 30, 2021, it generated cash from operations of $30.2 million. It had total available liquidity of $247.5 million as of Sep 30, 2021. Capital expenditure is expected to be $90-$100 million for 2021.The company bought back 1,333,264 shares of Aaron's common stock, worth $37.5 million. From the start of the year till Oct 22, it repurchased 3,034,097 shares for $90.4 million. Currently, the company has shares worth $59.6 million remaining to be bought back under its existing share repurchase program of $150 million. The board also approved a quarterly dividend of 10 cents per share, which was paid out on Oct 5.OutlookDriven by solid results, management raised its 2021 view. For 2021, the company anticipates revenues of $1.82-$1.83 billion, up from the earlier mentioned $1.775-$1.8 billion. Same-store revenues are forecast to grow 7.5-8.5% compared with 6-8% growth stated previously.Adjusted EBITDA is likely to be $225-$230 million, reflecting an improvement from the previously mentioned $215-$225 million. However, it slashed its free cash flow view from $90-$100 million to $30-$40 million for 2021 due to the higher sale of lease merchandise in the third quarter. Management expects customer payment activity to remain drab for the coming few quarters.For fourth-quarter 2021, write-offs and lease payment activities are likely to be lower than the year-ago quarter but above the pre-pandemic levels.How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -9.42% due to these changes.VGM ScoresAt this time, Aaron's has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Aaron's has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Aaron's Company, Inc. (AAN): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 25th, 2021

Burlington Stores" (BURL) Q3 Earnings Top, Revenues Rise Y/Y

Burlington Stores (BURL) posts better-than-expected results for third-quarter fiscal 2021, driven by the solid execution of its Burlington 2.0 initiative. Shares of Burlington Stores, Inc. BURL have jumped 8.6% in the trading hours on Nov 23, following the robust third-quarter fiscal 2021 results. The top and the bottom line beat the Zacks Consensus Estimate and compared favorably with the respective year-ago tallies.Quarterly performance was primarily buoyed by the successful execution of the Burlington 2.0 initiative. Also, BURL’s store-related efforts, including smaller store prototype, have been on track for a while. In fact, new stores, including smaller store prototype, are performing impressively.Over the past six months, the stock has increased 2.4% compared with the industry's rally of 18.2%.Insight Into the HeadlinesBurlington Stores delivered adjusted earnings of $1.36 per share, surpassing the Zacks Consensus Estimate of $1.27. The bottom line also increased from the year-ago quarter’s reported figure of 29 cents per share but decreased from $1.53 recorded in third-quarter fiscal 2019.Total revenues of $2,304 million surged 38.2% year over year and 29.3% from the third-quarter fiscal 2019 figure. Net sales increased nearly 30% from the third-quarter fiscal 2019 number to $2,300 million while Other revenues decreased 33.3% to $4.4 million. The Zacks Consensus Estimate stood below at $2,285 million for the reported quarter.Burlington Stores, Inc. Price, Consensus and EPS Surprise Burlington Stores, Inc. price-consensus-eps-surprise-chart | Burlington Stores, Inc. QuoteComparable-store sales (comps) grew 16% from the third-quarter fiscal 2019 reading. Solid pent-up demand coupled with the residual impacts of the federal stimulus payments distributed in March and gains from the robust execution of the 2.0 strategy aided comps. Burlington Stores’ entire key merchandise categories comfortably outperformed their expectations and comp-store sales across all regions of the country performed impressively.MarginsGross margin was 41.4% in the reported quarter, down 100 basis points (bps) from the third-quarter fiscal 2019 actuals. Merchandise margins grew 80 bps, more than offset by a 180-bps rise in freight expense. Also, increased supply-chain costs were deterrents.Adjusted EBITDA rose 6.5% from the third-quarter fiscal 2019 tally to $205 million. The metric also showed an increase from adjusted EBITDA of $113.5 million recorded in the third quarter of fiscal 2020.Adjusted EBIT was flat with the figure registered in the third quarter of fiscal 2019 at $140.3 million. The metric also showed a sharp jump from adjusted EBIT of $58.6 million during the third quarter of fiscal 2020. Adjusted EBIT margin fell 120 bps from the third-quarter fiscal 2019 finals.Other Financial AspectsThis presently Zacks Rank #3 (Hold) Burlington Stores ended the reported quarter with cash and cash equivalents of $1,185.4 million, long-term debt of $1,614.6 million and stockholders’ equity of $716.8 million. It exited the fiscal third quarter with $1,726 million of liquidity, including $1,185 million of unrestricted cash and $541 million available under its ABL facility.Burlington Stores ended the quarter with $1,629 million of outstanding total debt, which comprises $953 million under its Term Loan Facility, $645 million of Convertible Notes and no borrowings under its ABL Facility.Merchandise inventories were $1059.7 million, up 5.6% from the third-quarter fiscal 2019 tally. Comparable store inventories fell 24% from the level recorded in the same quarter of fiscal 2019. Reserve inventory accounted for 30% of the total inventory at the end of the reported quarter.Burlington Stores bought back 512,363 shares for $150 million under its share repurchase plan in the fiscal third quarter. As of Oct 30, 2021, it had $250 million remaining under the existing share repurchase authorization.During the reported quarter, Burlington Stores opened 40 net stores, raising the store count to 832. In the fiscal fourth quarter, it inaugurated additional eight stores and anticipates closing two outlets. In fiscal 2021, it projects to open 101 stores and relocate or shut down 24 outlets. This will add up to 77 net new outlets in the current fiscal year.OutlookManagement did not provide any specific sales and earnings view for fiscal 2021 (the 52 weeks ending Jan 29, 2022) due to the prevalent pandemic uncertainty and the pace of recovery of customer demand. Burlington Stores anticipates witnessing significant freight and supply-chain cost pressures through the fiscal fourth quarter.For the fiscal fourth quarter, management now projects comp sales to grow in the low double-digit percentage range. Moving forward, BURL expects quite a favorable buying environment. At the end of the fiscal fourth quarter, in-store inventories are likely to be down in the mid-30% range. It forecasts a deleveraged operating margin of 250 bps during the impending quarter.For fiscal 2021, management anticipates the operating margin to be flat with the 2019 tally. It expects about 360-bps deleveraged freight and supply-chain expenses with 350 bps of offsetting higher merchant margin and greater leveraged SG&A expenses.Capital expenditures, net of landlord allowances for fiscal 2021, are likely to be roughly $425 million.Stocks to ConsiderWe highlighted three better-ranked stocks in the Retail - Wholesale sector, namely Boot Barn Holdings BOOT, Tractor Supply Company TSCO and Target TGT. Boot Barn Holdings, the lifestyle retailer of western and work-related footwear, apparel and accessories, sports a Zacks Rank #1 (Strong Buy), currently. Shares of BOOT have jumped 66.4% in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here. The Zacks Consensus Estimate for Boot Barn Holdings’ current-year sales and earnings per share (EPS) suggests growth of 54.4% and 183.3%, respectively, from the corresponding year-ago period’s reported figures. BOOT has a trailing four-quarter earnings surprise of 35.3%, on average. Tractor Supply Company, a rural lifestyle retailer in the United States, flaunts a Zacks Rank of 1 at present. TSCO has a trailing four-quarter earnings surprise of 22.8%, on average. The stock has rallied 23.4% in the past six months. The Zacks Consensus Estimate for Tractor Supply Company’s current-year sales and EPS suggests growth of 19% and 23.9%, respectively, from the corresponding year-ago period’s reported numbers. TSCO has an expected EPS growth rate of 9.6% for three-five years. Target, a renowned omni-channel retailer, presently carries a Zacks Rank #2 (Buy). TGT has a trailing four-quarter earnings surprise of 19.7%, on average. The stock has surged 9.6% in the past six months. The Zacks Consensus Estimate for Target’s current-year sales and EPS suggests growth of 14% and 39.6%, respectively, from the corresponding year-ago period’s levels. TGT has an expected EPS growth rate of 14.4% for three-five years. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough stocks now>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Target Corporation (TGT): Free Stock Analysis Report Tractor Supply Company (TSCO): Free Stock Analysis Report Boot Barn Holdings, Inc. (BOOT): Free Stock Analysis Report Burlington Stores, Inc. (BURL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 25th, 2021

Jack in the Box (JACK) Q4 Earnings Top, Revenues Lag Estimates

Jack in the Box (JACK) fourth-quarter fiscal 2021 results reflect gains from robust Franchise rental revenues. Jack in the Box Inc. JACK reported mixed fourth-quarter fiscal 2021 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same. While the bottom line surpassed the consensus mark for the sixth straight quarter, the top line missed the same after beating in the preceding seven quarters. Following the results, the company’s shares declined 2.9% on Nov 23.Earnings & Revenue DetailsDuring the fiscal fourth quarter, adjusted earnings from continuing operations was $1.80 per share, which beat the Zacks Consensus Estimate of $1.74. The bottom line improved 9.8% year over year.Quarterly revenues of $278.5 million missed the Zacks Consensus Estimate of $288 million. However, the top line increased 9% on a year-over-year basis. Franchise rental revenues increased 7.3% year over year to $84.4 million. Franchise royalties and other revenues climbed 9.8% year over year to $49.3 million owing to rise in franchise same-store sales. Meanwhile, franchise contributions to advertising and other services revenues advanced 9% year over year to $49.2 million. Company restaurant sales increased to $95.6 million from $86.8 million.Comps DiscussionComps at Jack in the Box’s stores decreased 4.4% in the fiscal fourth quarter against growth of 9.6% in the prior-year quarter. Decline in comps was primarily due to dismal traffic, which was partially offset by increase in average check.Same-store sales at franchised stores increased 0.6% year over year compared with 12.4% growth in the prior-year quarter. Meanwhile, system-wide same-store sales increased 0.1% year over year compared with 12.2% gain reported in the year-ago quarter.Operating HighlightsDuring the fiscal fourth quarter, restaurant-level adjusted margin came in at 20.1%, compared with 27% reported in the prior-year quarter. The was due to the take back of lower-volume franchise restaurants, higher food and packaging costs, wage inflation of 9.8%, and rise in utilities and maintenance and repair costs. The decline was offset by lower incentive compensation and menu price increases.Food and packaging costs (as a percentage of company restaurant sales) rose 140 bps to 31% year over year. Commodity costs during the quarter increased 11.8% year over year. The increase was due to a rise in pork, beef and beverages costs.Franchise level margin was 41.4% in the fiscal fourth quarter compared with 41.3% in the prior-year quarter.During the quarter, selling, general and administrative expenses accounted for 7.7% of total revenues compared with 5.8% in the prior-year quarter.Balance SheetAs of Oct 3, 2021, cash (inclusive of restricted cash) totaled $55.3 million compared with $199.7 million as of Sep 27, 2020. Inventories during the quarter amounted to $2.3 million compared with $1.8 million as on Sep 27, 2020. Long-term debt (net of current maturities) totaled $1,273.4 million as of Oct 3 compared with $1,376.9 million at the end of Sep 27, 2020.During the fiscal fourth quarter, the company repurchased 0.7 million shares of its common stock for $70 million. On Nov 19, 2021, the company’s board of directors announced an additional $200 million stock buy-back program that expires on Nov 20, 2023.The company declared a cash dividend of 44 cents per share. The dividend will be paid out on Dec 23, 2021 to shareholders on record as of Dec 9, 2021.Fiscal 2022 OutlookGeneral and administrative expenses are anticipated to be $92-97 million in 2022. For fiscal 2022, company-owned wage rate guidance is expected to be up 8-10% compared to 2021. For fiscal 2022, commodity guidance is estimated to be up 6-7% compared to 2021. Restaurant Level Margin is anticipated to be 20-21%.Jack in the Box currently has a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Peer ReleasesPapa John’s International, Inc. PZZA reported robust third-quarter fiscal 2021 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate. During the fiscal third quarter, the company reported adjusted earnings of 83 cents per share, which beat the Zacks Consensus Estimate of 69 cents by 20.3%. The bottom line surged 137.1% from 35 cents in the prior-year quarter. Quarterly revenues of $512.8 million outpaced the consensus mark of $501 million by 2.3%. The top line increased 8.4% on a year-over-year basis.Papa John’s benefited from solid comparable sales in North America, driven by strong customer retention and innovation strategies. The company witnessed a rise in company-owned restaurant revenues, franchise royalties and commissary sales. International revenues benefited from higher franchise royalties and unit growth. This Zacks Rank #2 (Buy) company’s shares have gained 41% in the past six months compared with the industry’s growth of 2.2%.The Cheesecake Factory Incorporated CAKE reported third-quarter fiscal 2021 results, wherein both earnings and revenues missed the Zacks Consensus Estimate. In the quarter under review, adjusted earnings per share (EPS) was 65 cents, which lagged the Zacks Consensus Estimate of 70 cents. In the prior-year quarter, the company had reported an adjusted loss of 33 cents per share. This was primarily due to a rise in labor and other operating expenses.Cheesecake Factory gained from a solid off-premise sales growth. Quarter-to-date (through Nov 2), the off-premise model contributed 28% to total sales. Shares of the company have declined 25.3% in the past six months, against the industry’s growth of 2.2%. Cheesecake Factory has a Zacks Rank #3 (Hold).YUM! Brands, Inc. YUM reported strong third-quarter 2021 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate. Both the metrics improved year over year. During third-quarter 2021, the company’s adjusted earnings of $1.22 beat the Zacks Consensus Estimate of $1.06. In the prior-year quarter, the company had reported an adjusted earnings of $1.01. Quarterly revenues of $1,606 million outpaced the consensus mark of $1,584 million. The top line improved 11% year over year.YUM! Brands’ results in the quarter benefited from strong digital sales, robust unit development and a diversified global business model. The company strengthened its digital capabilities with the acquisition of Dragontail, which provides AI-based integrated kitchen order management and delivery technologies. The initiative paves the path for strengthening store operations and enhancing customer experience. During the third quarter, it reported digital sales of more than $5 billion. Shares of this Zacks Rank #3 company have gained 5.8% in the past six months. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Janus Henderson Sustainable & Impact Core Bond ETF (JACK): Free Stock Analysis Report Yum Brands, Inc. (YUM): Free Stock Analysis Report The Cheesecake Factory Incorporated (CAKE): Free Stock Analysis Report Papa John's International, Inc. (PZZA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

Here"s Why You Should Hit the Buy Button on AutoNation (AN)

AutoNation (AN) has rallied 82.8% year to date and is poised to maintain the bull run on the back of several tailwinds. It is advised to snap up AN to reap handsome rewards. AutoNation AN is benefiting from high demand for vehicles amid a preference for personal mobility and a rise in consumer spending. Shares of this auto retailer have rallied 82.8% year to date, handily outperforming the auto sector’s 18.6% growth. We are positive about the company’s prospects and believe that the time is right for you to add the stock to the portfolio as it looks promising and is poised to carry the momentum ahead.AutoNation currently carries a Zacks Rank #1 (Strong Buy) and a VGM Score of B. Our research shows that stocks with a VGM Score of A or B, combined with a Zacks Rank #1 or 2 (Buy), offer the best investment opportunities to investors.Let's see what makes this noted auto player a compelling investment option at the moment.Estimates Moving UpOver the past 30 days, the Zacks Consensus Estimate for AutoNation’s 2021 earnings has been revised upward by 43 cents per share. The consensus estimate for 2022 has also been revised 8.6% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.Positive Earnings Surprise HistoryAutoNation outpaced the Zacks Consensus Estimate in the last four quarters. In this time frame, it delivered an earnings surprise of 40.9%, on average.Solid ProspectsThe Zacks Consensus Estimate for AutoNation’s 2021 earnings is currently pegged at $17.17, indicating year-over-year growth of 141.2%. The same for sales suggests 26.1% growth for 2021.Attractive ValuationAutoNation’s valuation looks attractive as the stock is currently trading at a level that is lower than the auto sector average, suggesting that it still has upside potential.Going by the EV/EBITDA (Enterprise Value/ Earnings before Interest, Tax, Depreciation and Amortization) multiple, which is often used to value auto stocks, AutoNation is currently trading at 5.34 for the trailing 12-month period, which is cheaper than the industry average of 15.56.Set to Maintain the Bull RunAutoNation’s diversified product mix and multiple streams of income reduce risk profile and augur well for earnings and sales growth. A strong footprint, large dealer network, and aggressive store expansion efforts along with its brand extension strategy and alliances are praiseworthy.The buyout of 11 stores and one collision center from Peacock Automotive Group boosted AutoNation’s portfolio and is set to add $380 million in its annual revenues. The buyout of Priority 1 Automotive would add approximately $420 million in annualized revenues. Encouragingly, the firm aims to sell 1 million combined new and pre-owned vehicles on an annual basis, through organic growth, expansion of AutoNation USA and future buyouts.Enhanced digital solutions helped AutoNation to further boost profitability and market presence. Initiatives like ship-to-home next day, curb-side pick-up option, and buy online, pick-up in stores options are picking pace, driving additional traffic to the company’s online site. Omni-channel marketing remains a key component of the company’s long-term strategy and is likely to fuel revenues in the future. The company has stepped up digitization game with the launch of a digital platform AutoNation Express, which enables customers to buy and sell vehicles online, thereby providing them a truly comprehensive and personal experience.Increased focus on cost discipline is anticipated to aid margins. AutoNation is committed to operate below or at 60% SG&A as a percentage of gross profit in 2021, signaling a major improvement from the 71-73% range over the last several years. Its adjusted SG&A as a percentage of gross profit was 56.9% in the last reported quarter, representing a 750-basis point improvement year over year.Balance sheet strength and investor-friendly moves are other tailwinds. As of Sep 30, AutoNation had $1.8 billion of liquidity, including $72 million in cash and approximately $1.8 billion under the revolving credit facility. Its times interest earned ratio of 13.4 compares favorably with the industry’s 10.5. Thanks to solid income generation and a strong liquidity profile, the firm recently increased the share-buyback authorization up to an additional $1 billion, thereby boosting investors’ confidence. As of Oct 19, the company had $1.3 billion remaining under the current share repurchase authorization and 66 million shares outstanding.Other Auto Biggies Worth Betting OnOther top-ranked stocks worth considering in the auto space include Tesla TSLA, Goodyear Tire GT and Harley-Davidson HOG, each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.Tesla: With Model 3 being its flagship vehicle, Tesla has established itself as a leader in the electric vehicle segment. Currently, Model 3 is the best-selling premium sedan in the world. Along with the rising demand for Model 3, which forms a major chunk of the automaker’s overall deliveries, Model Y is boosting Tesla’s prospects. Tesla has also started making progress at ramping up volumes of Models S and X.Tesla has an expected earnings growth rate of 166.9% for the current year. The Zacks Consensus Estimate for TSLA's current-year earnings per share has been revised upward by 7 cents over the past 30 days. The company beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 25.4%, on average. TSLA has rallied around 57.2% year to date.Goodyear: Goodyear’s acquisition of Cooper Tire, which closed in June, strengthened the firm's leadership position in the global tire industry. The buyout of Raben Tire also expanded its network and strengthened Goodyear’s ability to serve fleets. Goodyear’s TireHub joint venture with Bridgestone bodes well for its long-term prospects. Goodyear has an expected earnings growth rate of 196.8% for the current year. The Zacks Consensus Estimate for GT's current-year earnings per share has been revised upward by 80 cents over the past 30 days. The company beat the Zacks Consensus Estimate for earnings in the last four quarters, with an average of 228.5%. GT has rallied around 105% year to date.Harley-Davidson: In sync with long-term growth objectives to optimize the product portfolio and expand the customer base, Harley-Davidson is focusing on motorcycle models and technologies that better align with market trends. The firm's turnaround plan — dubbed as ‘Rewire’ — and five-year strategic plan ‘Hardwire’ boost optimism. HOG’s new operating model and organizational structure have improved effectiveness across all functions.Harley-Davidson has an expected earnings growth rate of an astounding 35,900% for the current year. The Zacks Consensus Estimate for HOG’s current-year earnings per share has been revised upward by 32 cents over the past 30 days. HOG beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. The stock has moved up around 7.2% year to date. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report HarleyDavidson, Inc. (HOG): Free Stock Analysis Report The Goodyear Tire & Rubber Company (GT): Free Stock Analysis Report AutoNation, Inc. (AN): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

CVS Health (CVS) Installs Time-Delay Safes in Texas Pharmacies

CVS Health's (CVS) time-delay safes reduce theft and diversion of opioid medications and boost the security of stores, creating a safe environment for patients and staff. CVS Health Corporation CVS is progressing with its initiative to prevent pharmacy robberies and the potential for associated diversion of controlled substance medications. Recently, the company completed the deployment of time-delay safe technology in all 851 CVS Pharmacy locations, including those in Target stores across Texas.In September, CVS Health made the initial installation of new safes in all 223 CVS Pharmacy locations in Houston.Time-Delay Safes to Curb Retail Loss at CVS StoresAs stated earlier, these safes help prevent and address misuse and diversion of controlled substance medications — including opioid medications such as oxycodone and hydrocodone. This system electronically delays the time it takes for pharmacy employees to open the safe. These safes also claim to benefit the safety and well-being of CVS Pharmacy customers and employees.In 2015, CVS Health first implemented the time-delay safe technology in CVS Pharmacy locations across Indianapolis. With the installation of time-delay safes, the company witnessed a 70% decline in pharmacy robberies among Indianapolis stores. The safes, now in use in 19 states and the District of Columbia, have resulted in a 50% decline in robberies at CVS pharmacies in those local communities.Significance of Time-Delay Safe DeploymentThe time-delay function, which cannot be overridden, electronically delays the time it takes for pharmacy employees to open a safe, restricting robbers trying to get in and out of stores quickly. As time-delay safes reduce the theft and diversion of opioid medications, it brings added security to stores, creating a safe environment for patients and staff. Image Source: Zacks Investment ResearchFollowing the implementation, all CVS Pharmacy locations across Texas with time-delay safes will now display visible signage warning that these safes are in use to prevent on-demand access to controlled substance narcotics. Till now, through its Safe Medication Disposal Program in Texas, approximately 250,000 pounds of unwanted and expired medication have been collected in Texas.Recent DevelopmentsLast week, CVS Health announced several measures to support its ongoing strategy of making health care more affordable, accessible and convenient for consumers. With the announcement of these new measures, the company remains focused on the competitive advantage provided by its presence in thousands of communities across the country, which complements CVS Health’s rapidly expanding digital presence.The company also announced several executive leadership appointments and shared plans to close approximately 300 stores a year for the next three years. Notably, these changes will begin in the spring of 2022.In the third quarter of 2021, the company witnessed strong demand for integrated solutions across the healthcare continuum, including health management programs for chronic conditions, mental health support, pharmacy services, and health and wellness products.The retail segment reported above-market growth and also exceeded the company’s expectations with 10% revenue growth. Within pharmacy services, growth outperformed the company’s expectations, delivering 9.3% revenue growth and strong operating income growth. Specialty pharmacy revenues were up 8.7% year over year. The company also noted that it is strengthening the consumer experience by expanding digital services and platforms that connect to health services and in-person channels for more than 35 million unique digital customers.Price PerformanceShares of the company have gained 38.5% in a year compared with the industry’s 31.3% rise.Zacks Rank and Key PicksCVS Health currently carries a Zacks Rank #3 (Hold).A few better-ranked stocks from the broader medical space are Chemed Corporation CHE, Laboratory Corporation of America Holdings, or LabCorp LH and Medpace Holdings, Inc. MEDP.Chemed has a long-term earnings growth rate of 7.7%. The company surpassed earnings estimates in three of the trailing four quarters and missed in one, delivering a surprise of 5.6%, on average. Chemed currently carries a Zacks Rank #2.Chemed has outperformed its industry over the past year. CHE has gained 3.7% against a 35.6% industry decline.LabCorp reported third-quarter 2021 adjusted earnings per share (EPS) of $6.82, which surpassed the Zacks Consensus Estimate by 42.9%. Revenues of $4.06 billion outpaced the Zacks Consensus Estimate by 13.4%. LabCorp currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.LabCorp has an estimated long-term growth rate of 10.6%. LH surpassed estimates in the trailing four quarters, the average surprise being 25.7%.Medpace reported third-quarter 2021 adjusted EPS of $1.29, surpassing the Zacks Consensus Estimate by 20.6%. Revenues of $295.57 million beat the Zacks Consensus Estimate by 1.2%. Medpace currently carries a Zacks Rank #1.Medpace has an estimated long-term growth rate of 16.4%. MEDP surpassed estimates in the trailing four quarters, the average surprise being 11.9%. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Laboratory Corporation of America Holdings (LH): Free Stock Analysis Report CVS Health Corporation (CVS): Free Stock Analysis Report Chemed Corporation (CHE): Free Stock Analysis Report Medpace Holdings, Inc. (MEDP): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

Thanks to Wall Street for a Wonderful Rally YTD: 5 Top Picks

We have narrowed the search to five U.S. corporate behemoths that have skyrocketed more than 50% year to date. These are: GOOGL, TSLA, LOW, HD and XOM. Wall Street started 2021 from where it ended in 2020. Year to date, U.S. stock markets have seen an impressive rally after completing an astonishing 2020 despite being pandemic-ridden. Instead of the technology-driven rally like last year, Wall Street is witnessing a broad-based rally this year — across all segments (large, mid and small caps) and various sectors of the economy. Very few economists and financial analysts had anticipated such a powerful rally at the beginning of this year.At this stage, it will be prudent to invest in corporate giants that have popped in 2021 with a favorable Zacks Rank and strong upside left. Here are five such stocks — Tesla Inc. TSLA, Alphabet Inc. GOOGL, The Home Depot Inc. HD, Exxon Mobil Corp. XOM and Lowe's Companies Inc. LOW.Impressive 2021 So FarWall Street has had a dream run so far this year. The pandemic is not over yet and the resurgence of the Delta variant of coronavirus disrupted U.S. economic recovery this summer. To make the situation worse, inflation is currently at its peak in more than three decades thanks to prolonged global supply-chain bottleneck and acute labor shortage.Despite these headwinds, year to date, the three large-cap centric indexes — the Dow, the S&P 500 and the Nasdaq Composite — have surged 17%, 24.9% and 22.4%, respectively. The small-cap specific Russell 2000 and S&P 600 Index have advanced 17.9% and 28.1%, respectively. The mid-cap benchmark S&P 400 Index has surged 24.6% in the same period.Year to date, all 11 broad sectors of the market’s benchmark – S&P 500 Index – are in positive territory. Aside from the technology sector, cyclical sectors like energy, financials, consumer discretionary, materials and industrials have contributed significantly to the S&P 500 rally.The momentum of U.S. stocks markets is likely to continue and will pave the way for a year-end rally. Here are the reasons:Government’s Spending PlansOn Nov 15, President Joe Biden signed a bipartisan infrastructure bill of $550 billion in addition to the previously approved funds of $450 billion for five years. Total spending may go up to $1.2 trillion if the plan is extended to eight years.The infrastructure development project will be a major catalyst for the U.S. stock markets in 2022. Various segments of the economy such as basic materials, industrials, telecommunications and utilities will benefit immensely with more job creation for the economy.On Nov 19, the House of Representatives passed a massive $1.75 trillion social safety net and climate bill proposed by the Biden administration. The bill will now head toward the Senate. Moreover, the White House has put pressure on Congress to quickly pass legislation providing $52 billion to help computer chip manufacturers and ease a shortage of the components vital for a range of industries.Strong Projections for Holiday SalesThe National Retail Federation has projected November/December retail sales in 2021 to go up 8.5% to 10.5% from 2020. Deloitte forecasts retail sales growth of 7% to 9% during the November-to-January period.Digital Commerce 360 has estimated that holiday retail sales through all channels, including physical stores, will likely rise 9.4% during the season. KPMG expects 2021 U.S. holiday sales to be 7% higher than last year. Mastercard SpendingPulse forecasts a 7.4% year-over-year rise in U.S. holiday sales.Solid Growth of U.S. GDP and Corporate ProfitIn its latest projection on Nov 17, the Atlanta Fed reported that the U.S. economy will grow by 8.2% in fourth-quarter 2021. U.S. GDP grew 6.4%, 6.7% and 2%, in the first, second and third quarters of this year, respectively.As of Nov 17, total third-quarter earnings of the market's benchmark — the S&P 500 Index — are projected to jump 40.3% from the same period last year on 17.2% higher revenues. Moreover, in fourth-quarter 2021, total earnings of the S&P 500 index are expected to up 19.4% year over year on 11.1% higher revenues.Our Top PicksWe have narrowed the search to five U.S. corporate behemoths (market capital > $100 billion) that have skyrocketed more than 50% year to date. These stocks still have more upside left for the rest of 2021 and have seen positive earnings estimate revisions within the last 30 days. Each of our picks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The chart below shows the price performance of our five picks year to date.Image Source: Zacks Investment ResearchAlphabet Inc. has been strongly emphasizing AI techniques and the home automation space that should aid business growth in the long term. Solid momentum across search, advertising, cloud and YouTube businesses aided the results of GOOGL. Further, the growing proliferation of consumer online activities and rising advertiser spending remained as tailwinds.Alphabet's robust cloud division continues to be the key catalyst. Expanding data centers will continue to bolster its presence in the cloud space. Further, major updates in its search segment are enhancing the search results. Moreover, GOOGL’s mobile search is constantly gaining traction.Alphabet has an expected earnings growth rate of 84% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 5.9% over the last 30 days. The stock price of GOOGL has soared 66.4% year to date.Tesla Inc. has acquired a substantial market share within the electric car segment. Increasing Model 3 delivery, which forms a significant chunk of TSLA’s overall deliveries, is aiding its top line. Along with Model 3, Model Y is contributing to its revenues.In addition to increasing automotive revenues, Tesla’s energy generation and storage revenues boost its earnings prospects. The automaker said that its overall deliveries surged 20% in the third quarter from its previous record in the second quarter, marking the sixth consecutive quarter-on-quarter gain.Tesla has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings improved 9.7% over the last 30 days. The stock price of TSLA has jumped 57.2% year to date.The Home Depot Inc. is witnessing significant benefits from the execution of the “One Home Depot” investment plan, which focuses on expanding supply chain facilities, technology investments and enhancement to the digital experience.Amid the pandemic, customers have been increasingly blending the physical and digital elements of the shopping experience, making the interconnected One Home Depot strategy most relevant. The Home Depot is effectively adapting to the demand for renovations and construction activities, driven by prudent investments. HD is gaining from growth in Pro and DIY customer categories as well as digital momentum.The Home Depot has an expected earnings growth rate of 28.2% for the current year (ending January 2022). The Zacks Consensus Estimate for current-year earnings has improved 5.3% over the last 7 days. The stock price of HD has surged 53.8% year to date.Exxon Mobil Corp. made multiple world-class oil discoveries at the Stabroek Block, located off the coast of Guyana. XOM has raised the estimate for discovered recoverable resources from the Stabroek Block to approximately 10 billion oil-equivalent barrels.Exxon Mobile’s bellwether status and an optimal integrated capital structure, which has historically produced industry-leading returns make it a relatively lower-risk energy sector play. The integrated oil behemoth expects to reduce greenhouse gas emissions by 30% in its upstream business. By the same time, XOM expects to reduce flaring and methane emissions by 40%.Exxon Mobil has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings improved 0.2% over the last 7 days. The stock price of XOM has advanced 53.2% year to date.Lowe's Companies Inc. remains well-positioned to capitalize on the demand in the home improvement market backed by investments in technology, merchandise category and strength in Pro business. Management is committed toward expanding LOW’s market share and boosting the operating margin.Lowe's Companies new total home strategy, which includes providing complete solutions for various types of home repair and improvement, bodes well. The strategy is an extension of LOW’s retail-fundamentals approach.Lowe's Companies has an expected earnings growth rate of 33.8% for the current year (ending January 2022). The Zacks Consensus Estimate for current-year earnings has improved 4.2% over the last 7 days. The stock price of LOW has climbed 57% year to date. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exxon Mobil Corporation (XOM): Free Stock Analysis Report Lowe's Companies, Inc. (LOW): Free Stock Analysis Report The Home Depot, Inc. (HD): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

Titan Machinery (TITN) Beats on Q3 Earnings, Hikes "22 View

Titan Machinery's (TITN) Q3 results benefit from solid performance across its segments. Titan Machinery Inc. TITN reported third-quarter fiscal 2022 (ended as of Oct 31, 2021) adjusted earnings per share (EPS) of 96 cents, up 81% year over year. The upside can be attributed to solid performance across all three segments — Agricultural, Construction and International. Earnings also beat the Zacks Consensus Estimate of 61 cents.On a reported basis, the company delivered EPS of 97 cents in the reported quarter compared with 44 cents in the prior-year quarter.Total revenues in the quarter were $454 million, up 26% from the year-ago quarter’s levels. The top line also surpassed the consensus mark of $430 million. Equipment revenues rose 37% year over year to $329.8 million and parts revenues were up 5% to $81 million. Revenues generated from service were $32 million in the reported quarter, up 4.6% from the year-ago quarter’s levels. However, rental revenues declined 7.2% year over year to $12 million.Costs and MarginsCost of sales was up 25% to $361 million from the prior-year quarter’s figure. Gross profit increased 26% year over year to $92.5 million. The gross margin was 20.4% compared with 20.1% in the year-ago quarter.Operating expenses increased 16% year over year to $63 million due to higher variable expenses on increased revenues. Adjusted EBITDA increased 42% year over year to $35 million. Adjusted EBITDA margin in the quarter was 7.8% compared with 6.8% in the prior-year quarter.Titan Machinery Inc. Price, Consensus and EPS Surprise  Titan Machinery Inc. price-consensus-eps-surprise-chart | Titan Machinery Inc. Quote Segmental PerformanceAgriculture revenues rose 28% to $282 million from $221 million in the year-ago quarter, driven by strong demand for equipment. The segment’s adjusted income before taxes rose 42% year over year to around $20 million.Construction revenues were $79.7 million in the fiscal third quarter compared with the year-ago quarter’s $79 million. Same-store sales increased on strong equipment demand, offset by the lost contributions from the company's Arizona stores following the January 2021 divestiture. The segment reported adjusted income before taxes of $3.6 million compared with the prior-year quarter’s $1.4 million.International revenues were $93 million, reflecting growth of 51.4% from the year-ago quarter’s levels, attributable to strong equipment sales. The segment reported an adjusted income before taxes of $6.1 million compared with $0.2 million in the year-ago quarter.Financial PositionCash generated from operating activities was $72 million in the nine-months period ended on Oct 31, 2021, compared with the prior-year  $61 million. Titan Machinery ended third-quarter fiscal 2022 with a cash balance of around $91 million compared with $79 million at the end of fiscal 2021. Long-term debt as of Oct 31, 2021, was around $71 million compared with $45 million as of Jan 31, 2021.Guidance Raised for Fiscal 2022Titan Machinery now expects Agriculture revenues to increase 23-28% year over year compared with its previous guidance of 18-23% growth. The Construction segment’s year-over-year revenue growth is projected to be 2-7%, in line with the previous guidance. The International segment’s revenues are expected to increase 35-40% year over year in fiscal 2022, up from the prior guidance of 27-32% growth.Backed by the ongoing momentum in its markets, the company expects EPS for fiscal 2022 between $2.40 and $2.60, higher than the previous range of $2.00-$2.20.Share Price PerformanceIn the past year, shares of Titan Machinery have gained 106.6% compared with the industry’s growth of 44.9%.Image Source: Zacks Investment ResearchZacks Rank & Other Stocks to ConsiderTitan Machinery currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Some other top-ranked stocks in the Retail - Wholesale sector are Boot Barn Holdings BOOT, Tractor Supply Company TSCO and Costco COST. While Boot Barn and Tractor Supply sport a Zacks Rank #1, Costco carries a Zacks Rank #2.Boot Barn has an expected earnings growth rate of around 183% for fiscal 2022. The Zacks Consensus Estimate for fiscal 2022 earnings has been revised 24% upward in the past 60 days to $5.44 per share, suggesting year-over-year growth of 183.3%.Boot Barn’s shares have surged 202.1% in the past year. The company has a trailing four-quarters earnings surprise of 35.3%, on average.Tractor Supply Company has a projected earnings growth rate of around 24% for 2021. The Zacks Consensus Estimate for current-year earnings has been revised upward by 7.8% in the past 60 days to $8.51 per share, calling for a year-over-year rise of 23.8%.The company’s shares have appreciated 70.1% in a year. Tractor Supply Company has a trailing four-quarter earnings surprise of 22.8%, on average. It has a long-term earnings growth of 9.6%.Costco has an estimated earnings growth rate of around 9.7% for the fiscal 2022. In the past 60 days, the Zacks Consensus Estimate for fiscal 2022 earnings has been revised upward by 3.8% to $12.15 per share, indicating a year-over-year increase of 9.7%.The company’s shares have returned 45.3% in the past year. Costco has a trailing four-quarter earnings surprise of 7.7%, on average. It has a long-term earnings growth of 8.6%. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tractor Supply Company (TSCO): Free Stock Analysis Report Costco Wholesale Corporation (COST): Free Stock Analysis Report Boot Barn Holdings, Inc. (BOOT): Free Stock Analysis Report Titan Machinery Inc. (TITN): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksNov 24th, 2021

Guess? (GES) Q3 Earnings & Revenues Top Estimates, Up Y/Y

Guess?'s (GES) third-quarter fiscal 2022 results reflect improved year-over-year earnings and revenues. Quarterly performance gained from sales growth across all regions, except Asia. Guess? Inc. GES reported splendid third-quarter fiscal 2022 results, with the top and the bottom line increasing year over year. Revenues and earnings surpassed their respective Zacks Consensus Estimates. Management raised its fiscal 2022 revenues and operating margin outlook. The company increased its quarterly dividend rate to boost shareholders’ returns.Quarterly performance gained from sales growth across allregions, except Asia. Management is particularly impressed with strong growth in operating margin driven by solid gross margin expansion thanks to reduced promotional activity and better IMUs.Guess, Inc. Price, Consensus and EPS Surprise  Guess, Inc. price-consensus-eps-surprise-chart | Guess, Inc. Quote Quarter in DetailGuess? posted adjusted earnings of 62 cents per share, up 6.9% from the year-ago quarter’s reported figure. Earnings in the quarter reflect favorable currency translations and minimal impact from share repurchases as well as convertible notes transactions. Earnings surpassed the Zacks Consensus Estimate of 46 cents. Adjusted earnings surged 181.8% from 22 cents reported in third-quarter fiscal 2020.Net revenues amounted to $643.1 million, which surpassed the consensus mark of $615.1 million. The metric went up 13% from $569.3 million reported in the year-ago quarter. On a constant-currency (cc) basis, net revenues increased 12.8% year over year. The upside can be attributed to solid performance across European Wholesale, Americas Retail and Licensing businesses.The company’s net revenues rose 4.4% from $615.9 million reported in third-quarter fiscal 2020 (pre-pandemic period), reflecting solid growth in European business driven by the wholesale and e-commerce categories. Permanently-closed stores and negative same-store sales in Europe and Asia affected the metric.The company’s gross margin expanded to 45.7% from 42.1% reported in the year-ago quarter. As a percentage of sales, SG&A expenses increased to 34.8% from 32.5% in the prior-year quarter’s level.During the quarter, adjusted earnings from operations came in at $70.4 million, up from $55.3 million posted in the year-ago quarter. Adjusted operating margin came in at 10.9%, up 1.2% year on year on the back of reduced markdowns, increased initial markups and leveraging expenses. These upsides were somewhat offset by increased performance-based compensation.Segment PerformanceRevenues in the Americas Retail segment rallied 30% year over year on a reported basis, while increasing 29% at cc. Revenues fell 5% from third-quarter fiscal 2020 levels. Segmental operating margin came in at 14.2% compared with 0.4% in the year-ago quarter.Revenues in the Americas Wholesale unit rallied 64% (up 61% at cc) year over year. Revenues were up 5% from third-quarter fiscal 2020 levels. Segmental operating margin came in at 29.3% compared with 22.9% in the year-ago quarter.The Europe segment’s revenues rose 3% (up 4% at cc) year on year. Revenues increased 19% from third-quarter fiscal 2020 levels. Segmental operating margin came in at 13.5% compared with 16% in the year-ago quarter.Asia revenues declined 8% (same at cc) year on year. The metric fell 31% from third-quarter fiscal 2020 levels.Licensing revenues advanced 37% year over year. The unit’s revenues were up 20% compared with third-quarter fiscal 2020 levels. The operating margin came in at 91.8% compared with 93.8% in the year-ago quarter.Other UpdatesThe company exited the quarter with cash and cash equivalents of $391.1 million as well as long-term debt and finance lease obligations of $67.5 million. Stockholders’ equity was $625.3 million. Net cash provided by operating activities for the nine months ended Oct 30, 2021 amounted to $4.6 million.The company increased its quarterly dividend from 11.25 cents per share to 22.5 cents. The revised dividend is payable on Dec 24, 2021 to shareholders on record as of Dec 8.COVID-19 UpdateThe pandemic-related disruptions continue to impact the company’s operations. Although quarterly revenues increased year over year, management continued to face challenges related to lower store traffic and capacity restrictions. The company started the third quarter with all directly-operated stores open for business. However, some government-mandated temporary store closures came into effect toward the end of the quarter. The company witnessed less than 5% directly-operated store closures as of Oct 30, 2021, mainly in Europe.In the wake of the ongoing uncertainties related to the pandemic, Guess? continues to monitor global and regional developments, especially in Europe. Also, the company is managing expenses to preserve profitability.Image Source: Zacks Investment ResearchOutlookFor fourth-quarter fiscal 2022, the company expects revenues to be down mid-single digits from fourth-quarter fiscal 2020. The guidance indicates impact from permanent store closures and unfavorable shift of European wholesale shipments from fourth-quarter fiscal 2022 to first-quarter 2023. These are likely to be partially offset by the ongoing momentum in the company’s global e-commerce business.For fiscal 2022, management now expects revenues to decline in low-single digits from fiscal 2020 levels, considering there will not be any more pandemic-related closures. The company now expects operating margin to come in at nearly 11% in fiscal 2022. Earlier, the company guided fiscal 2022 revenues to decline in mid-single digits from fiscal 2020 levels. The company had earlier anticipated operating margin to come in at nearly 10% in fiscal 2022.The Zacks Rank #3 (Hold) stock has declined 11.8% in the past three months against the industry’s growth of 5.9%.Upcoming Earning Releases in the Consumer Discretionary SectorPVH Corp. PVH, is slated to report earnings on Dec 1, 2021. The company is likely to register a bottom-line increase when it reports third-quarter 2021 results. The Zacks Consensus Estimate for quarterly earnings per share (EPS) has remained unchanged in the past 30 days at $2.06. The figure suggests an increase of 56.1% from the year-ago quarter’s reported number.PVH Corp’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $2,398 million, suggesting an increase of 13.2% from the figure reported in the prior-year quarter. PVH presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Duluth Holdings Inc. DLTH is slated to report earnings on Dec 2, 2021. The company is likely to register a bottom-line decline when it reports third-quarter 2021 numbers. The Zacks Consensus Estimate for the bottom line has remained unchanged in the past 30 days at a loss of 19 cents per share. The projection suggests a significant decline from EPS of 3 cents reported in the year-ago quarter.Duluth Holdings’ top line is expected to grow year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $142.5 million, suggesting growth of 5.1% from the figure reported in the prior-year quarter. DLTH carries a Zacks Rank #3.NIKE, Inc. NKE is slated to report earnings on Dec 20, 2021. The company is likely to register a bottom-line decline when it reports second-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly EPS has remained unchanged in the past 30 days at 62 cents. The figure suggests a slump of 20.5% from the year-ago quarter’s reported number.NIKE’s top line is also expected to fall year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $11,233 million, suggesting a drop of 0.1% from the figure reported in the prior-year quarter. NKE carries a Zacks Rank #4 (Sell). Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NIKE, Inc. (NKE): Free Stock Analysis Report Guess, Inc. (GES): Free Stock Analysis Report PVH Corp. (PVH): Free Stock Analysis Report Duluth Holdings Inc. (DLTH): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksNov 24th, 2021

Macy"s (M) Beats on Earnings in Q3, Raises FY21 Guidance

Macy's (M) Q3 results reflect strength across brands. The company lifts fiscal 2021 view and announces the launch of a digital marketplace platform. Macy’s, Inc.’s M shares soared 21.2% during the trading session on Nov 18, following robust third-quarter fiscal 2021 results. The company’s top and the bottom line improved year on year as well as surpassed the Zacks Consensus Estimate. The company narrowed and raised its view for fiscal 2021.The quarterly performance gained from the effective execution of the Polaris Strategy and improved consumer spending across brands. The company continued to offer a wide range of merchandise assortments to meet growing demand conditions.  Macy’s gained from accelerated execution of the Polaris strategy and strong omni-channel capabilities. Such strategic efforts keep the company well-positioned for growth in the forthcoming periods. As Macy’s progresses with the fourth quarter, it is optimistic regarding the holiday season. Management expects that its efficient digital capabilities and omni-channel services will help it meet consumers’ needs amid the challenges emerging from labor shortages and supply chain disruptions. The company announced the launch of a curated digital marketplace platform that will fuel customer acquisition and sales growth across all channels.Shares of this Zacks Rank #2 (Buy) company have surged 72.9% in the past three months compared with the industry's rise of 32.8%.Image Source: Zacks Investment ResearchQ3 in DetailsMacy’s reported adjusted earnings of $1.23 per share, which surpassed the Zacks Consensus Estimate of earnings of 35 cents. The bottom line improved from a loss of 19 cents reported in the year-ago quarter. The figure also increased from adjusted earnings of seven cents in third-quarter fiscal 2019.Net sales of $5,440 million came ahead of the Zacks Consensus Estimate of $5,327 million. The top line surged 36.3% on a year-over-year basis. Comparable sales surged 37.2% on an owned basis and 35.6% on an owned-plus-licensed basis, year over year. Compared with third-quarter fiscal 2019, comparable sales increased 8.9% on an owned basis and 8.7% on an owned-plus-licensed basis. Management highlighted that comparable sales in the reported quarter includes a 200 basis points (bps) gain from the Friends and Family promotional event.Comparable sales across the Macy’s, Bloomingdale and Bluemercury brands rose 36.4%, 43.4% and 39.5% on an owned basis, year over year. On an owned-plus-licensed basis, comparable sales across these brands increased 35.1%, 38.5% and 39.5% year on year, respectively.The company’s digital sales increased 19% from the year-ago quarter’s figure. The metric was up 49% from third-quarter fiscal 2019 levels. Digital sales contributed 33% to net sales. In the reported quarter, digital penetration in net sales fell 5-percentage point from the prior-year period’s levels, while it improved 10-percentage points from third-quarter fiscal 2019 tally.In the reported quarter, the company acquired 4.4 million new customers for the Macy’s brand, up 28% from third-quarter fiscal 2019 level. Of the new customers acquired, 41% came through the digital channel.During the quarter, the company witnessed Platinum, Gold and Silver customers re-engage in the Star Rewards Loyalty program. Average customers spend rose 16% compared with third-quarter fiscal 2019 levels. The Bronze segment, which comprises the most diverse loyalty tier, continued to grow by adding 2.3 million members.During the quarter, the company witnessed strong growth across categories like home, fragrances, jewelry, watches and sleepwear. Occasion-based categories like dresses, men’s tailored and luggage continued to recover. Emerging categories like toys and pets, showed encouraging results and the company continues to expand in these areas and related brands. Under the Bloomingdale banner, growth was mainly driven by strong sales of luxury handbags, fine jewelry, home, men’s shoes and contemporary apparel. Bluemercury witnessed strong growth in private brands as well as in home fragrance and treatment.Net credit card revenues amounted to $213 million, up $30 million from third-quarter fiscal 2019 levels. The metric contributed 3.9% to sales, down 100 bps year on year and up 40 bps from third-quarter fiscal 2019 levels. Improved customer credit health continued to contribute to credit card revenues.Gross margin came in at 41%, up from 35.6% in the prior-year quarter and 100 bps from third-quarter fiscal 2019 levels. The upside was driven by higher merchandise margin, supported by strong pricing, promotions and solid inventory-productivity initiatives driven by the Polaris Strategy. Delivery expenses, as a percentage of sales, increased 170 bps from third-quarter fiscal 2019 levels.SG&A expense increased 34.3% year over year to $1,973 million. As a percentage of sales, SG&A expenses were 36.3%, down 700 bps year on year. The quarter gained from disciplined expense management and improved productivity stemming from the Polaris strategy. It also includes permanent cost savings realized in 2020 and reduced labor costs due to elevated job openings in stores. Macy’s reported adjusted EBITDA of $765 million against adjusted EBITDA loss of $159 million in the year-ago quarter. Adjusted EBITDA amounted to $325 million in third-quarter fiscal 2019.Macy's, Inc. Price, Consensus and EPS Surprise  Macy's, Inc. price-consensus-eps-surprise-chart | Macy's, Inc. Quote Key Financial Aspects & Other DevelopmentsMacy’s had cash and cash equivalents of $316 million at the end of the fiscal third quarter. Merchandise inventories, as of Oct 30, 2021, amounted to $6,141 million. Long-term debt and shareholders’ equity were $3,295 million and $3,008 million, respectively.The company’s strong cash position, on a year-to-date basis, encouraged management to invest in growth and de-levering the balance sheet. It repaid $294 million of debt that was due in January 2022 in addition to the early repayment of the previously-announced $1.3-billion senior secured notes in August.During the third quarter, the company repurchased $300 million of shares. This accounted for 60% of the $500 million authorization. The company paid $46 million in cash dividends to shareholders.In a separate release, Macy’s announced the launch of a digital marketplace to strengthen its omni-channel retailing capabilities. The new marketplace will help the company expand assortments and introduce new categories. To power the platform, Macy’s is partnering with Mirakl — a leading enterprise marketplace technology company. The platform is expected to be launched in the second half of 2022.OutlookManagement is impressed with the company’s third-quarter performance. This along with strong market trends as the company heads into the holiday season, led management to raise view for fiscal 2021.The company expects net sales in the bracket of $24.12-$24.28 billion, up from the previous guidance of $23.55-$23.95 billion. Adjusted earnings are anticipated in the range of $4.57-$4.76 compared with the prior projection of $3.41-$3.75 per share. The Zacks Consensus Estimate for sales and earnings in fiscal 2021 is currently pegged at nearly $24 billion and $3.93 per share, respectively.As a percentage of sales, adjusted EBITDA is expected to be greater than 12.5% compared with 11-11.5% anticipated earlier.For the fourth quarter, the company expects comparable sales on an owned-plus-licensed basis to increase 2-4% from fourth-quarter fiscal 2019 levels. The figure includes an adverse impact of nearly 125 bps, due to the shift of the Friends and Family promotional event to the third quarter.Here are 3 Key Stocks for YouWe have highlighted some other top-ranked stocks in the Retail - Wholesale sector, namely Tractor Supply Company TSCO, Fastenal Company FAST and Costco Wholesale Corporation COST.Tractor Supply Company, a rural lifestyle retailer in the United States, sports a Zacks Rank #1 (Strong Buy). The company has a trailing four-quarter earnings surprise of 22.8%, on average. Shares of TSCO have increased 17.6% in the past three months. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Tractor Supply Company's current financial year sales and earnings per share (EPS) suggests growth of 19% and 23.9%, respectively, from the year-ago quarter's reported figures. TSCO has a long-term earnings growth rate of 9.6%.Costco, which operates membership warehouses, has a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 7.7%, on average. Shares of the company have increased 16.7% in the past three months.The Zacks Consensus Estimate for Costco’s current financial year sales and EPS suggests growth of 9.6% and 9.7%, respectively, from the year-ago period’s levels. COST has a long-term earnings growth rate of 8.6%.Fastenal, a national wholesale distributor of industrial and construction supplies, currently has a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 2%, on average. Shares of FAST have increased 11% in the past three months.The Zacks Consensus Estimate for Fastenal's current financial year sales and EPS suggests growth of 5.5% and 5.4%, respectively, from the year-ago period’s levels. FAST has a long-term earnings growth rate of 9%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Macy's, Inc. (M): Free Stock Analysis Report Fastenal Company (FAST): Free Stock Analysis Report Tractor Supply Company (TSCO): Free Stock Analysis Report Costco Wholesale Corporation (COST): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

NIKE (NKE) Raises Dividend, Boosts Shareholders" Wealth

NIKE (NKE) hikes quarterly dividend by 11% to 30.5 cents per share. This marks the company's 20th consecutive year of raising the dividend. Well-known footwear and apparel company, NIKE, Inc. NKE, announced a hike of 11% in quarterly dividend rate for outstanding Class A and Class B Common Stock. Efficient growth strategies and strong cash flows have strengthened the company’s financial base, which is helping it boost shareholders’ wealth.The latest increase brings the quarterly dividend to 30.5 cents a share, up from the prior rate of 27.5 cents. This marks the company’s 20th consecutive year of raising the dividend. The revised dividend is payable on Dec 28, 2021 to shareholders on record as at the close of business on Dec 6, 2021.  During first-quarter fiscal 2022, the company paid out dividends worth $435 million. Although the company has been executing quarterly dividend payments, the recent hike instills greater optimism. The move indicates the company’s commitment to deliver long-term shareholder value. It also reflects the confidence in its financial position and the ability to generate sufficient cash flows.In the context of share repurchase activities, NIKE bought back shares worth $742 million during the first quarter. The company completed share repurchases of 4.8 million shares under its $15-million program approved in June 2018. As of Aug 31, it repurchased 54.8 million shares for $5.4 billion under the aforementioned program.Speaking of cash position, NIKE ended the first quarter with strong liquidity, which included cash and short-term investments of $13,695 million. The figure was up $4.2 billion from the last year’s levels. As of Aug 31, the company had no current portion of long-term debt. The latest dividend hike reflects the company’s dividend yield of roughly 0.7%, based on the closing share price of $171.35 on Nov 18. These aspects make the company’s dividend payment sustainable.Image Source: Zacks Investment ResearchStrategic Growth Efforts Bodes WellNIKE has been progressing well with its Consumer Direct Acceleration strategy to fuel growth. The company is gaining from an efficient digital ecosystem, which comprises its online site as well as commercial and activity apps. During the first quarter, digital revenues in the NIKE Brand were up 29% year over year on a reported basis. The company expects revenues in fiscal 2022 and beyond to benefit from robust growth in digital sales. The company is also benefitting from reviving traffic conditions across stores, with leniency in pandemic-led restrictions. Efforts to boost assortments, including innovation, have been yielding.This Zacks Rank #5 (Strong Sell) company has been battling supply chain challenges and factory closures due to COVID-19, which led to product shortages and is hampering the mobility of products. The company anticipates such delays in transit times to continue throughout fiscal 2022. Moreover, elevated freight and rising selling and administrative expenses have been eclipsing the company’s margin growth.We expect prudent growth efforts and favorable market conditions to continue supporting the company and help it overcome the aforementioned headwinds. That said, shares of the company have moved up 2.2% in the past three months compared with the industry’s rise of 2.3%.Here are 3 Key Stocks for YouWe have highlighted three better-ranked stocks in the Consumer Discretionary sector, namely lululemon athletica inc. LULU, PVH Corp. PVH and Funko, Inc. FNKO.lululemon, a well-known athletic apparel company, has a Zacks Rank #2 (Buy). The company has a trailing four-quarter earnings surprise of 25.2%, on average. Shares of the company have increased 18.9% in the past three months. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for lululemon 's current financial year sales and earnings per share (EPS) suggests growth of 42.2% and 59.8%, respectively, from the year-ago quarter's figures. LULU has a long-term earnings growth rate of 20%.PVH Corp, which specializes in designing and marketing branded apparel and accessories, currently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 177.5%, on average. Shares of the company have increased 16% in the past three months.The Zacks Consensus Estimate for PVH Corp’s current financial year sales and EPS suggests growth of 28% and 540%, respectively, from the year-ago period’s levels. PVH has a long-term earnings growth rate of 59.1%.Funko, engaged in manufacturing a wide range of consumer products, currently sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 110.7%, on average.The Zacks Consensus Estimate for Funko's current financial year sales and EPS suggests an increase of 48.3% and 240.5%, respectively, from the year-ago period’s tallies. FNKO has a long-term earnings growth rate of 40.4%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report NIKE, Inc. (NKE): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis Report PVH Corp. (PVH): Free Stock Analysis Report Funko, Inc. (FNKO): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

CVS Health"s (CVS) New Measures to Boost Omnichannel Health

CVS Health's (CVS) new measures will support its strategy of making health care more affordable, accessible and convenient for consumers. CVS Health Corporation CVS recently announced several measures to support its ongoing strategy of making health care more affordable, accessible and convenient for consumers. With the announcement of several new measures, the company is focused on the competitive advantage provided by the presence in communities across the country. This factor complements CVS Health’s rapidly-expanding digital presence.The company announced several executive leadership appointments and shared plans to close approximately 300 stores a year for the next three years. These changes will begin in the spring of 2022.Leadership Position TransitionsThe company appointed Mr. Prem Shah (the current executive vice president, Specialty Pharmacy and Product Innovation) for the newly-created role of chief pharmacy officer. Shah will oversee the entire omnichannel pharmacy strategy.On Jan 1, 2022, Shah and Michelle Peluso (the company’s current executive vice president and chief customer officer) will become co-presidents of CVS Health’s retail business, with Peluso overseeing front-store strategy and operations.In connection with the new leadership appointments, Neela Montgomery -- currently executive vice president and president, CVS Retail/Pharmacy, has decided to leave the company.More on the New InitiativesAs part of the company's strategic review of the retail business, CVS Health will also develop new store formats to accelerate higher customer engagement.The company stated that three diverse models will serve as community health destinations, including sites intended to offer primary care services, an improved version of HealthHUB locations with products and services designed for everyday health and wellness needs, and traditional CVS Pharmacy stores that offers prescription services and health, wellness, personal care as well as other convenient retail offerings.Financial ImplicationsIn association with the planned closing of the stores, the company expects to record impairment expenses of $1.00-$1.20 billion or 56-67 cents of diluted earnings per share (EPS) in fourth-quarter 2021.As a result of the planned store closures, the company also revised its full-year 2021 adjusted EPS guidance range to $5.46-$5.67 from $6.13-$6.23. The impairment expenses are excluded from the company's calculation of adjusted EPS.  The Zacks Consensus Estimate for the same is pegged at $7.94.Image Source: Zacks Investment ResearchThe company projects the impact to adjusted EPS to be immaterial in 2021 and 2022 and modestly accretive in 2023 and thereafter.Recent DevelopmentsCVS Health has been making significant progress in business banking on strength across all three of its operation segments.During third-quarter 2021, the company witnessed strong demand for integrated solutions across the healthcare continuum, including health management programs for chronic conditions, mental health support, pharmacy services, and health and wellness products in the reported quarter.The retail segment reported above-market growth and exceeded the company’s expectations with 10% revenue growth. Pharmacy services outperformed the company’s expectations, delivering a 9.3% revenue increase and strong operating income growth. Specialty pharmacy revenues were up 8.7% year over year. The company noted that it is enhancing consumers’ experience by expanding digital services and platforms that connect to health services and in-person channels for more than 35 million unique digital customers.Price PerformanceShares of the company have gained 43.6% in a year’s time compared with the industry’s rise of 36.8%.Zacks Rank and Other Key PicksCVS Health currently carries a Zacks Rank #2 (Buy).A few other top-ranked stocks from the broader medical space are Chemed Corporation CHE, Laboratory Corporation of America Holdings, or LabCorp LH and Medpace Holdings, Inc. MEDP, each carrying a Zacks Rank #2.Chemed has a long-term earnings growth rate of 7.7%. The company surpassed earnings estimates in three of the trailing four quarters and missed in one. It has a trailing four-quarter earnings surprise of 5.6%, on average.Chemed has outperformed its industry in the past year. CHE has gained 3.7% against a 35.6% decline of the industry.LabCorp reported third-quarter 2021 adjusted EPS of $6.82, which surpassed the Zacks Consensus Estimate by 42.9%. Revenues of $4.06 billion outpaced the Zacks Consensus Estimate by 13.4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.LabCorp has an estimated long-term growth rate of 10.6%. LH surpassed estimates in the trailing four quarters, the average surprise being 25.7%.Medpace reported third-quarter 2021 adjusted EPS of $1.29, surpassing the Zacks Consensus Estimate by 20.6%. Revenues of $295.57 million beat the Zacks Consensus Estimate by 1.2%.Medpace has an estimated long-term growth rate of 16.4%. MEDP surpassed estimates in the trailing four quarters, the average surprise being 11.9%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Laboratory Corporation of America Holdings (LH): Free Stock Analysis Report CVS Health Corporation (CVS): Free Stock Analysis Report Chemed Corporation (CHE): Free Stock Analysis Report Medpace Holdings, Inc. (MEDP): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Starbucks (SBUX) Banks on Expansion Efforts Amid Cost Woes

Starbucks (SBUX) benefits from robust comps growth, digitalization and expansion efforts. The company's earnings in fiscal 2022 are likely to be impacted by strategic investments and cost inflation. Starbucks Corporation SBUX has been benefiting from robust comps growth, digitalization and expansion efforts. However, strategic investments and cost inflation are likely to dent the company’s earnings in fiscal 2022. So far this year, the company’s shares have gained 7.3%, compared with the industry’s rally of 11.8%.Growth DriversStarbucks continues to benefit from robust comps growth. The company’s U.S. comps have impressed investors for the third straight quarter. In fourth-quarter fiscal 2021, the company’s North America segment reported comps growth of 22% year over year, owing to an 18% increase in transaction comps and a 3% rise in average ticket. U.S. comps rose 20% in the fiscal fourth quarter, owing to a material increase in transaction comps of 19%. The company now anticipates global comparable sales to reach high-single digits in fiscal 2022.Despite the pandemic, the company has been expanding its presence. Starbucks opened 130 and 260 net new stores in third and fourth-quarter fiscal 2020, respectively. It inaugurated 1,400 new stores in fiscal 2020. In fiscal 2021, Starbucks opened 1,173 net new stores worldwide, bringing the total store count to 33,833. The company expects to inaugurate nearly 2,000 net new stores worldwide in fiscal 2022. In terms of expansion in China, it opened 225 net new stores (in the fiscal fourth quarter) and 654 net new stores (in fiscal 2021), thereby bringing the total count to 5,360 stores in the region. The company plans to build 600 net new stores annually over the next five years in Mainland China, which will double the market's store count from the end of fiscal 2017 to 6,000 across 230 cities.During fourth-quarter fiscal 2021, operations in Starbucks China were affected by pandemic-induced restrictions across 18 provincial level regions. With a majority of the stores closed (or operating at different levels of elevated public health protocols), the company reported constrained customer mobility with operations pertaining to mobile ordering and limited seating. Although the crisis affected the recovery momentum, the company witnessed a recovery in September, driven by a solid pace of store developments and significant growth in digital customer relationships. In the fiscal fourth quarter, the company registered a 5% sequential increase in its digital footprint with Starbucks Rewards reaching 17.9 million active members. Emphasis on member engagement and exclusive offerings favored the company. Also, frequency of purchases by Gold members stood at pre-pandemic levels.The Zacks Rank #3 (Hold) company made progress with respect to personalized digital relationship to expand reach with members. This includes program enhancements like Stars for Everyone. Starbucks initiated payment partnerships with PayPal and Bakkt, thereby enabling customers to reload their Starbucks card via a range of cryptocurrencies (including Bitcoin and Ethereum) coupled with the option of converting digital currencies to physical currency. The company is exploring the blockchain platform for ways to connect Starbucks Rewards program with other merchant rewards program along with the motive of tokenization of stars.Image Source: Zacks Investment ResearchConcernsDespite an impressive sales outlook, the company’s earnings in fiscal 2022 are likely to be impacted by strategic investments and cost inflation. The expiration of government subsidies in Asia and the transition of Starbucks Korea to the licensee are likely to hurt the company’s margin in fiscal 2022. For fiscal 2022, the company anticipates non-GAAP EPS growth to be a minimum 10% from the base of $3.10 in fiscal 2021 (the figure is adjusted for non-GAAP treatment of certain integration costs and excludes the involvement of extra week). However, the figure is well below the analyst’s expectation.Moreover, dismal Channel Development revenues continue to hurt the company. In fourth-quarter fiscal 2021, the segment’s net revenues declined 6%, following a fall of 7%, 29% and 25% year over year in the third, the second and the first quarter of fiscal 2021, respectively. The downside was primarily due to nearly 20% unfavorable impact of Global Coffee Alliance transition-related activities.Key Restaurant PicksDave & Buster's Entertainment, Inc. PLAY, which has been benefiting from reopening initiatives, expanding vaccinations and excellent operational execution, sports a Zacks Rank #1 (Strong Buy). The company anticipates sustaining the momentum in the days ahead, backed by its strategic initiatives that include new menu, optimized marketing and technology investments.Dave & Buster's has reported better-than-expected earnings in each of the trailing four quarters, the average surprise being 201.8%. The company’s fiscal 2021 earnings is likely to witness growth of 147.7%. PLAY stock has gained 24% in the past three months. You can see the complete list of today’s Zacks #1 Rank stocks here.Kura Sushi USA, Inc. KRUS carries a Zacks Rank #2 (Buy). The company has a trailing four-quarter earnings surprise of 15.6%, on average. Shares of the company have gained a whopping 114.2% in the past six months.The Zacks Consensus Estimate for Kura Sushi’s current financial year sales and earnings per share suggests growth of 108% and 85.7%, respectively, from the year-ago period.Del Taco Restaurants, Inc. TACO has a Zacks Rank #2. The company has a trailing four-quarter earnings surprise of 25.7%, on average. Shares of the company have gained 3.3% in the past three months.The Zacks Consensus Estimate for Del Taco Restaurants’ current financial year sales and earnings per share suggests an improvement of 7.2% and 33.3%, respectively, from the year-ago period. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Starbucks Corporation (SBUX): Free Stock Analysis Report Dave & Buster's Entertainment, Inc. (PLAY): Free Stock Analysis Report Del Taco Restaurants, Inc. (TACO): Free Stock Analysis Report Kura Sushi USA, Inc. (KRUS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Bet on These Retail ETFs to Ride the Holiday Sales Momentum

Considering the existing tailwinds, we highlight some ETFs that investors can consider to tap the holiday sales surge. Investors are highly optimistic about the retail space as the sector is seeing strong earnings reports and sales momentum. With the holiday season approaching, the optimism on the sector returns is growing. Of the 77.1% S&P 500 companies in the sector that have reported the third-quarter earnings results so far, 85.2% witnessed and earnings and revenue beat. Earnings grew 8.4% year over year, with revenues seeing an 11% rise, per the Earnings Trends report as of Nov 17, 2021.In an encouraging development, the retail sales data came out to be remarkable. The metric rose 1.7% in October (the largest surge since March), beating economists’ estimate of a 1.4% rise. This, in turn, marked a 16.3% increase from the year-ago figure (according to a Reuters article). The metric rose for the third consecutive month. Online sales rose 10.2% from the year-ago level.In order to ride the ongoing retail sector optimism, investors can track ETFs like Amplify Online Retail ETF IBUY, ProShares Online Retail ETF ONLN, SPDR S&P Retail ETF XRT and VanEck Retail ETF RTH.In another positive development, the U.S. jobs report for November seems very impressive. Nonfarm payrolls rose by 531,000 in October, surpassing the estimate of 450,000, per a CNBC article. Also, beating expectations, the unemployment rate declined to 4.6%, hitting a new pandemic low level (according to a CNBC article).Consumers seem to be looking forward to buying homes, motor vehicles and major household durables. Several surveys and reports support the fact that the proportion of the population planning to go on vacation has shot up to the highest level since February 2020, as mentioned in a Reuters article.Commenting on strength in the retail space, E-Trade’s Mike Loewengart has said that “With the robust retail sales read and solid start to retail earnings, it’s crystal clear that inflation isn’t standing in the way of consumers. Despite some hiccups on the labor market and inflation fronts, this could serve as the vote of confidence investors needed signaling that the economy is still chugging along nicely. As we narrow in on the holiday shopping season, the question remains if better than expected numbers from retailers from Q3 can continue to close out 2021,” as mentioned in a CNBC article.Retailers have adequately prepared themselves for the holiday season (the late October-December period) that is considered a busy season for many industry players and market participants. The quarter is also marked by some popular retail events like Halloween, Thanksgiving, Cyber Monday, Black Friday and Christmas, which increase its significance among retailers.According to the National Retail Federation (“NRF”), holiday season sales in 2021 are projected to surpass all existing records during November and December and rise 8.5-10.5% year over year to between $843.4 billion and $859 billion. Holiday sales increased 8.2% in 2020 to hit a record of $770 billion.Also, studying Mastercard SpendingPulse data,  U.S. retail sales — excluding automotive and gas — for the “75 Days of Christmas” from Oct 11 to Dec 24 are anticipated to increase 6.8% from the year-earlier figure.Considering Deloitte’s annual holiday sales forecast, retail sales for the holiday season are projected to rise between 7% and 9% this year, per a prnewswire article. The retail sales figure is predicted to fall in the $1.28-$1.3 trillion range during the November-January period.The pandemic has been a blessing in disguise for the e-commerce industry to date as people continue to practice social distancing and shopping online for all essentials, especially food items. Thus, on par with the digitization trend, the upcoming U.S. holiday season is expected to see a significant surge in online sales. The NRF projects online and other non-store sales increase of 11% to 15% to reach between $218.3 billion and $226 billion compared with $196.7 billion in 2020. Mastercard SpendingPulse predicts online sales to increase 7.5% during the “75 Days of Christmas” phase.Retail ETFs to ConsiderConsidering the strong trends, investors may want to park their money in the following retail ETFs to tap the sales boom.Amplify Online Retail ETF Amplify Online Retail ETF attracted $904.7 million to its asset base and offers global exposure to companies that derive 70% or more revenues from online and virtual retail by tracking the EQM Online Retail Index.Amplify Online Retail ETF is home to 80 stocks, each accounting for less than 2.24% of its assets. IBUY charges 65 bps in annual fees (read: 5 ETFs to Buy This Holiday Season for Gift of Good Returns).ProShares Online Retail ETFProShares Online Retail ETF focuses on global retailers that derive significant revenues from online sales. ONLN tracks the ProShares Online Retail Index, holding 25 stocks in its basket.ProShares Online Retail ETF has accumulated $895.8 million in its asset base and charges 58 bps in annual fees (read: Grab Retail ETFs on Upbeat Holiday Sales Forecast).SPDR S&P Retail ETF With AUM of $1.30 billion, SPDR S&P Retail ETF tracks the S&P Retail Select Industry Index. XRT holds 107 securities in its basket with each accounting for not more than 1.72% of assets. Internet & direct marketing retail, apparel retail, automotive retail and specialty stores are the top four sectors with a double-digit allocation each.SPDR S&P Retail ETF charges 35 bps in annual fees (read:  ETFs to Buy on Fund Managers' Big Bet on U.S. Stocks).VanEck Retail ETF VanEck Retail ETF provides exposure to the 25 largest retail firms by tracking the MVIS US Listed Retail 25 Index. It is highly concentrated on the top three firms with a combined 41.4% share.VanEck Retail ETF has amassed $249 million in its asset base and charges 35 bps in annual fees. Want key ETF info delivered straight to your inbox? Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR S&P Retail ETF (XRT): ETF Research Reports VanEck Retail ETF (RTH): ETF Research Reports Amplify Online Retail ETF (IBUY): ETF Research Reports ProShares Online Retail ETF (ONLN): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Here"s Why Nordstrom (JWN) Looks Poised to Beat on Q3 Earnings

Nordstrom's (JWN) Q3 results are expected to reflect gains from customer demand and strong digital momentum. Nordstrom, Inc. JWN is scheduled to release third-quarter fiscal 2021 numbers on Nov 23, after the closing bell. The fashion specialty retailer is expected to have witnessed revenue and earnings growth in the to-be-reported quarter.The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at 56 cents per share, suggesting a substantial increase of 154.6% from the year-ago quarter's reported figure of 22 cents. The consensus mark has moved up 3.7% in the past seven days. The consensus mark for revenues is pegged at $3.54 billion, indicating a rise of 14.5% from the figure reported in the year-ago quarter.In the last reported quarter, the company witnessed an earnings surprise of 88.5%. It delivered an earnings surprise of 557.3%, on average, in the trailing four quarters.Nordstrom, Inc. Price and EPS Surprise Nordstrom, Inc. price-eps-surprise | Nordstrom, Inc. QuoteKey Factors to NoteNordstrom has been gaining from solid demand, better inventory, stringent cost-cutting actions, and improved sales trends at Nordstrom and Nordstrom Rack as well as across regions and categories. Strength in shoes, apparel and accessories are also expected to have been aided JWN, with active, home and designer categories getting back to the pre-pandemic level.The company remains focused on technology advancement by boosting e-commerce and digital networks, and improving its supply-chain channels and marketing efforts. Gains from improved digital traffic across both Nordstrom and Nordstrom Rack have been aiding the digital business. Alongside these, the integration of Rack.com onto Nordstrom.com should have contributed to the company's top line in the quarter under review.On its last reported quarter's earnings call, Nordstrom forecast sales improvement for the third and fourth quarters of fiscal 2021 on a sequential basis.The company's fiscal third-quarter performance is expected to have benefited from its market strategy, which helps engage with customers through better service and greater access to products, irrespective of the shopping mode. As part of the strategy, Nordstrom expanded facilities like order pickup and ship-to-store to all Nordstrom Rack stores.JWN also remains focused on the closer-to-you strategy, which aims to link stores and services to expedite deliveries, expand online offerings, and add cheaper merchandise to its Rack off-price stores to improve customers' shopping experiences. A rise in new customers, enhanced personalization and expanded product offering are likely to have aided the fiscal third-quarter results.However, the company's sales and earnings performances are still short of the pre-pandemic levels. The pre-pandemic period is a more suitable basis for comparison for retailers as elevated COVID-19 impacts related to temporary store closures hurt industry-wide results throughout 2020. Nordstrom is also reeling under higher COVID-related labor and freight costs.On its last reported quarter's earnings call, management expected freight and labor costs to persist in the second half of fiscal 2021, which are likely to result in higher SG&A from the first half.What Does the Zacks Model Say?Our proven model predicts an earnings beat for Nordstrom this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.Nordstrom has an Earnings ESP of +0.40% and carries a Zacks Rank #3.Stocks With the Favorable CombinationHere are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:Costco Wholesale COST currently has an Earnings ESP of +1.00% and a Zacks Rank of 2. The company is anticipated to register an increase in the bottom and top lines when it reports first-quarter fiscal 2022 results. You can see the complete list of today's Zacks #1 Rank stocks here.The Zacks Consensus Estimate for COST's quarterly earnings moved up 2.8% in the last 30 days to $2.59 per share and the same suggests a 13.1% jump from the year-ago quarter's reported number. The Zacks Consensus Estimate for Costco's quarterly revenues is pegged at $49.6 billion, which suggests a rise of 14.8% from the figure reported in the prior-year quarter. The COST stock has rallied 40.7% year to date.The Kroger Co.'s KR currently has an Earnings ESP of +3.71% and a Zacks Rank of 3. Although the Zacks Consensus Estimate for quarterly earnings has moved up by a penny in the last 30 days to 66 cents per share, it indicates a 7% decline from the year-ago quarter's reported number.However, Kroger's top line is expected to have risen year over year. The Zacks Consensus Estimate for KR's quarterly revenues is pegged at $31 billion, suggesting growth of 4.4% from the figure reported in the prior-year quarter. KR's stock has rallied 30.6% year to date.Foot Locker FL currently has an Earnings ESP of +7.16% and a Zacks Rank of 3. The company is likely to register growth in the bottom and top lines when it reports third-quarter fiscal 2021. The Zacks Consensus Estimate for FL's quarterly earnings moved up by a penny in the last seven days to $1.32 per share. This suggests a 9.1% jump from the year-ago quarter's reported number.The Zacks Consensus Estimate for Foot Locker's quarterly revenues is pegged at $2.12 billion, suggesting a rise of 0.8% from the figure reported in the prior-year quarter. The FL stock has gained 39.8% year to date. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Kroger Co. (KR): Free Stock Analysis Report Nordstrom, Inc. (JWN): Free Stock Analysis Report Costco Wholesale Corporation (COST): Free Stock Analysis Report Foot Locker, Inc. (FL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 18th, 2021