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Factors to Know Ahead of Hain Celestial's (HAIN) Q1 Earnings

Zacks Equity Research

The Hain Celestial Group, Inc. HAIN is scheduled to report first-quarter fiscal 2020 numbers on Nov 7, before the opening bell. In three of the trailing four quarters, this food conglomerate underperformed the Zacks Consensus Estimate, delivering an average negative earnings surprise of 19.1%. In the last reported quarter, the company delivered negative earnings surprise of 4.6%.

The Zacks Consensus Estimate for first-quarter fiscal 2020 earnings has remained unchanged in the past 30 days at 7 cents per share, suggesting a decline of 22.2% from the year-ago quarter’s reported figure.

For revenues, the consensus mark is pegged at $493.2 million, indicating a decrease of 12.1% from the figure reported in the year-ago quarter.

The Hain Celestial Group, Inc. Price, Consensus and EPS Surprise

 

The Hain Celestial Group, Inc. Price, Consensus and EPS Surprise

The Hain Celestial Group, Inc. price-consensus-eps-surprise-chart | The Hain Celestial Group, Inc. Quote

 

Key Factors to Note

Hain Celestial has been witnessing dismal top line for a while now, stemming from softness in the United States, the U.K. and Rest of World sales. Such trends may have lingered in the quarter under review. Additionally, Stock Keeping Units (“SKU”) rationalization and pricing initiatives, along with foreign currency headwinds are likely to have impacted the top line.

The Zacks Consensus Estimates for net sales at the United States segment is pegged at $220 million for the first quarter, suggesting a decline of approximately 9.8% from the prior-year quarter’s reported figure. The consensus marks for net sales at the U.K. and Rest of World stand at $178 million and $93 million, suggesting year-over-year declines of 18.7% and 5.1%, respectively.

This apart, cost inflation has been a threat to Hain Celestial’s margins. Nonetheless, focus on Project Terra (aimed at cutting costs) and the transformation strategy are likely to have offered some cushion. The transformation strategy is focused on simplifying portfolio, solidifying key capacities, enhancing margins, reviving top-line growth, and improving cash flows.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Hain Celestial this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Hain Celestial carries a Zacks Rank #3, and has an Earnings ESP of 0.00%.

Stocks With Favorable Combination

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

Foot Locker, Inc. FL has an Earnings ESP of +2.80% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Grocery Outlet Holding Corp. GO has an Earnings ESP of +2.70% and a Zacks Rank #2.

Ollie's Bargain Outlet Holdings, Inc. OLLI has an Earnings ESP of +3.45% and a Zacks Rank #3.

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Ollie's Bargain Outlet Holdings, Inc. (OLLI) : Free Stock Analysis Report
 
The Hain Celestial Group, Inc. (HAIN) : Free Stock Analysis Report
 
Foot Locker, Inc. (FL) : Free Stock Analysis Report
 
Grocery Outlet Holding Corp. (GO) : Free Stock Analysis Report
 
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