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Factors That Hold Key to Burlington Stores (BURL) Q2 Earnings

Zacks Equity Research

Burlington Stores, Inc. BURL is scheduled to report second-quarter fiscal 2019 results on Aug 29, before the opening bell. We note that in the trailing four quarters, this off-price retailer has outperformed the Zacks Consensus Estimate, recording average positive earnings surprise of 8.7%. Let’s see how the company is positioned ahead of the upcoming quarterly results.

How Are Estimates Faring?

The Zacks Consensus Estimate for second-quarter earnings is pegged at $1.15, indicating no change from the year-ago reported figure. Notably, the consensus mark has remained unchanged over the past 30 days.

For revenues, the consensus estimate stands at $1,629 million, suggesting a rise of about 8.7% from the year-ago quarter.

Burlington Stores, Inc. Price, Consensus and EPS Surprise

 

Burlington Stores, Inc. Price, Consensus and EPS Surprise

Burlington Stores, Inc. price-consensus-eps-surprise-chart | Burlington Stores, Inc. Quote

Factors Likely to Influence Results

Burlington Stores’ focus on vendor count growth, technological advancements, marketing enhancements, efficient inventory management and cost containment is likely to play vital role in the to-be-reported quarter. These efforts have been aiding the company’s performance amid high freight and SG&A expenses.

The company has been doing quite well on the revenue front. Its revenues have not only outpaced the estimates in 10 out of the 13 trailing quarters but have also shown constant improvement over the past few quarters. Management had earlier projected second-quarter fiscal 2019 sales to increase 8-9% with comps growth of 1-2%. The company forecasts adjusted earnings to be $1.11-$1.15 per share.

Notably, the company has made multiple changes to its business model to adapt to the ongoing changes in the industry. Burlington Stores, which started business as a coat-focused off-price retailer, is now focusing on “open to buy” off-price model. The current model is helping customers to get nationally branded, fashionable, high quality as well as right priced products.

What Our Model Says

Our proven model does show that Burlington Stores is likely to beat estimates this quarter. This is because a stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Burlington Stores has a Zacks Rank #2 and Earnings ESP of +0.17%, which makes us confident of a beat. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks With Favorable Combination

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

Casey's General Stores, Inc. CASY has an Earnings ESP of +8.43% and a Zacks Rank #1.

Dollar General Corporation DG has an Earnings ESP of +2.64% and a Zacks Rank #2.

Costco Wholesale Corporation COST has an Earnings ESP of +0.30% and a Zacks Rank #3.

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