Big Lots (BIG) to Post Q2 Results: Here's a Peek Into Comps
Market watchers are eagerly awaiting Big Lots, Inc.’s BIG second-quarter fiscal 2023 earnings results, scheduled to be reported on Aug 29, before market open. This time also, investor focus will be on comparable store sales, the key metric to gauge the company’s performance.
Insights Into Comparable Sales (Comps)
Before delving into the fiscal second quarter, let's revisit the first quarter.
Comparable sales recorded a decline of 18.2% in the first quarter of fiscal 2023. The metric was largely hurt by roughly 300 basis points (bps) due to product shortages in furniture stemming from the closure of the company’s largest vendor in November 2022. In the quarter, Big Lots witnessed pressure in the market environment, primarily in higher ticket and other discretionary items. Also, lower tax refunds and higher interest rates affected the demand for its products, in turn affecting its performance.
Management expects the trend to have continued in the fiscal second quarter and hurt its performance. For the second quarter of fiscal 2023, Big Lots expects comps to decline in the high-teens range. Product shortages in furniture are likely to have hurt comps by 100 basis points. We expect a comparable store sales decline of 18.2% for the quarter under discussion.
However, Big Lots’ Operation North Star initiative and e-commerce business appear encouraging. Strength in the company’s Broyhill and Real Living brands is likely to have boosted its performance. Also, its ability to adjust inventory levels based on demand, along with its efforts of boosting assortments and merchandising capabilities, is likely to have been tailwinds. BIG expects net new stores to have contributed 30 basis points of year-over-year growth in second-quarter fiscal 2023.
Big Lots, Inc. Price and EPS Surprise
Big Lots, Inc. price-eps-surprise | Big Lots, Inc. Quote
How Are Estimates Shaping Up?
The Zacks Consensus Estimate for revenues stands at $1,100 million, indicating an 18.3% drop from the prior-year reported figure. The consensus mark for the quarterly bottom line is pegged at a loss of $4.15 per share, declining 2.2% in the past 30 days. The figure suggests a decline of 82% from the year-ago period’s reported figure.
Big Lots has an Earnings ESP of -2.76% and a Zacks Rank #4 (Sell).
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, which is not the case here.
3 Stocks With Favorable Combination
Here 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:
American Eagle Outfitters AEO currently has an Earnings ESP of +8.52% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is expected to report bottom-line growth when it releases second-quarter fiscal 2023 results. The Zacks Consensus Estimate for earnings is pegged at 15 cents per share, indicating an increase of 275% from the year-ago quarter’s reported level.
The company’s revenues are anticipated to have declined year over year. The consensus mark for the same is pegged at $1.19 billion, implying a 0.9% decrease from that reported in the prior-year period.
Casey's General Stores CASY currently has an Earnings ESP of +1.03% and a Zacks Rank #3. The company is expected to register a bottom-line decline when it reports first-quarter fiscal 2024 results. The Zacks Consensus Estimate for earnings is pinned at $3.39 per share, indicating a fall of 17.1% from the year-ago quarter’s reported number.
The company’s revenues are anticipated to decrease year over year. The consensus mark for the same is pinned at $3.85 billion, indicating a deterioration of 13.5% from that reported in the year-ago quarter. CASY has a trailing four-quarter average earnings surprise of 7.5%.
lululemon athletica LULU currently has an Earnings ESP of +2.10% and a Zacks Rank of 3. LULU is likely to record top-line growth when it reports second-quarter fiscal 2023 results.
The Zacks Consensus Estimate for revenues is pegged at $2.2 billion, indicating a 16.1% improvement from the prior-year quarter’s actual. The consensus mark for earnings is pinned at $2.53 per share, implying a 15% increase from that reported in the comparable period of 2022. LULU has a trailing four-quarter earnings surprise of 9.9%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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
American Eagle Outfitters, Inc. (AEO) : Free Stock Analysis Report
Big Lots, Inc. (BIG) : Free Stock Analysis Report
lululemon athletica inc. (LULU) : Free Stock Analysis Report
Casey's General Stores, Inc. (CASY) : Free Stock Analysis Report
