Will Cabela's (CAB) Miss Q2 Estimates on Weak Firearms Sales?


Cabela's Incorporated (CAB), a leading outfitter of hunting, fishing and outdoor gear, is slated to report its second quarter 2014 results on Jul 24, 2014. Last quarter, it posted a negative surprise of 2.7%. Let us see how things are developing for this announcement.

Growth Factors This Quarter

Persistent weakness in sale of firearms and ammunitions and other shooting related categories along with tough year-over-year comparisons are likely to mar quarterly results. However, good performance of its next-generation stores and sustained growth at its CLUB Visa program are expected to run down the negatives to an extent.

Earnings Whispers

Our proven model does not conclusively project Cabela's as likely to beat earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. This is not the case here as you will see below.

Zacks ESP:  ESP for Cabela's is 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate stand at 51 cents.

Zacks Rank #3: Cabela's Zacks Rank #3 when combined with a 0.00% ESP makes surprise prediction difficult. We caution against stocks with a Zacks Rank #4 and #5 (Sell-rated stocks) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows these to have the right combination of elements to post an earnings beat:  

Avis Budget Group, Inc. (CAR) Earnings ESP stands at +3.18% and it carries a Zacks Rank #2.

Colgate-Palmolive Co. (CL) with an Earnings ESP of +1.37% holds a Zacks Rank #2.

Marinemax Inc. (HZO) has an Earnings ESP of +13.21% and a Zacks Rank #2.

Read the Full Research Report on CAB
Read the Full Research Report on CAR
Read the Full Research Report on CL
Read the Full Research Report on HZO

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