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BJ's Wholesale Club (BJ) Q2 Earnings in Focus: Factors to Note

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BJ's Wholesale Club Holdings, Inc. BJ is likely to register a decline in the bottom line when it reports second-quarter fiscal 2021 results on Aug 19, before market open. We note that the Zacks Consensus Estimate for quarterly earnings has moved up by a penny to 63 cents over the past seven days. The figure suggests a decline from earnings of 77 cents reported in the year-ago quarter.

Notably, this operator of membership warehouse clubs has a trailing four-quarter earnings surprise of 26.1%, on average. In the last reported quarter, this Westborough-based company’s bottom line surpassed the Zacks Consensus Estimate by a significant margin of 26.3%.

Further, the Zacks Consensus Estimate for revenues is pegged at $3,864 million, indicating a decline of 2.3% from the prior-year reported figure.

Factors to Note

BJ's Wholesale Club is likely to have faced tough year-over-year comparisons in sales. Industry experts believe that lower at-home consumption activities and a drop in pantry-loading trends might have hurt the company’s top-line performance. On its last earnings call, management projected comps decline of around 10% for the remainder of the fiscal year.

Nonetheless, the company’s focus on simplifying assortments, expanding into high-demand categories and building own-brands portfolio is commendable. It is also committed toward enhancing omni-channel capabilities and providing value to customers. The company has been directing resources toward expanding digital capabilities in order to better engage with members and provide them a convenient way to shop, including same-day delivery, curbside pick-up, and buy-online, pickup-in-club. These endeavors are likely to have favorably impacted quarterly performance.

Well, margins remain an area to watch, given the current inflationary environment. Again, impact of costs associated with digital fulfilment, supply chain and COVID-related expenses cannot be ruled out. We note that costs related to additional employee payments and benefits, and investments undertaken to preserve safety and health of customers and team members amid the coronavirus crisis might have weighed on margins.

BJs Wholesale Club Holdings, Inc. Price, Consensus and EPS Surprise

BJs Wholesale Club Holdings, Inc. Price, Consensus and EPS Surprise
BJs Wholesale Club Holdings, Inc. Price, Consensus and EPS Surprise

BJs Wholesale Club Holdings, Inc. price-consensus-eps-surprise-chart | BJs Wholesale Club Holdings, Inc. Quote

What the Zacks Model Unveils

Our proven model predicts an earnings beat for BJ's Wholesale Club 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.

BJ's Wholesale Club has a Zacks Rank #2 and an Earnings ESP of +1.59%.

3 More Stocks With Favorable Combination

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

Gap GPS has an Earnings ESP of +53.66% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Nordstrom JWN has an Earnings ESP of +1.61% and a Zacks Rank #3.

Costco COST has an Earnings ESP of +0.44% and a Zacks Rank #3.


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Nordstrom, Inc. (JWN): Free Stock Analysis Report

BJs Wholesale Club Holdings, Inc. (BJ): Free Stock Analysis Report

Costco Wholesale Corporation (COST): Free Stock Analysis Report

The Gap, Inc. (GPS): Free Stock Analysis Report

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