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Will Big 5 (BGFV) Miss Earnings?

Zacks Equity Research

Big 5 Sporting Goods Corp. (BGFV) is scheduled to report its first-quarter fiscal 2014 results after the market closes on Apr 29. Last quarter, this sporting goods retailer posted a positive earnings surprise of approximately 9.09%. Let's see how things are shaping up for this announcement.

Growth Factors in the Past Quarter

Big 5 reported satisfactory financial results for the fourth quarter and fiscal 2013, driven by continued focus on improvising product margins and effective cost management. The company sales improved year over year, while comps declined marginally in the fourth quarter. Sales results were primarily impacted by comparatively higher firearm and ammunition sales in the prior-year period and an unfavorable weather across the western markets, offset by a heartening performance in other categories that mainly reflected the success of the company’s merchandising and marketing strategies.

Additionally, the company came up with disheartening projections as it anticipates a taxing first-quarter fiscal 2014 ahead due to the diminished demand for firearms and ammunition products and an unusually harsh winter in the western markets zone coupled with severe drought conditions that hindered the demand for winter products.

Earnings Whispers?

Our proven model does not conclusively project Big 5 as likely to beat earnings this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 to surpass earnings estimates. However, this is not the case here due to the following factors:
Zacks ESP: ESP for Big 5 is 0.00% since the Most Accurate estimate stands at 9 cents per share, which is in line with the Zacks Consensus Estimate.

Zacks Rank #5 (Strong Sell): Big 5’s Zacks Rank #5 when combined with 0.00% ESP makes surprise prediction difficult. We caution against stocks with a Zacks Ranks #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks that Warrant a Look

Here are some other companies you may want to consider as our model shows they have the right combination of elements:

The Walt Disney Company’s (DIS) Earnings ESP stands at +1.03% and it carries a Zacks Rank #2 (Buy).

Church & Dwight Co. Inc. (CHD) has an Earnings ESP of +1.37% and a Zacks Rank #3 (Hold).

Dish Network Corp. (DISH) with an Earnings ESP of +4.65% holds a Zacks Rank #3 (Hold).

Read the Full Research Report on DISH
Read the Full Research Report on BGFV
Read the Full Research Report on CHD
Read the Full Research Report on DIS

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