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Factors Likely to Influence Conn's (CONN) Fate in Q1 Earnings

·4 min read

Conn’s, Inc. CONN is slated to report first-quarter fiscal 2022 results on Jun 3, before market open. This specialty retailer of furniture and mattresses, home appliances, consumer electronics and home office products is likely to have witnessed earnings and revenue growth in the to-be-reported quarter.

The Zacks Consensus Estimate for the company’s fiscal first-quarter earnings is pegged at 29 cents per share, which suggests an increase of 115.3% from the year-ago quarter’s reported figure. However, the consensus mark has remained unchanged in the past 30 days. For fiscal first-quarter revenues, the consensus mark is pegged at $327.2 million, suggesting 3.2% growth from the prior-year quarter’s reported figure.

Factors to Note

Conn’s has been gaining from favorable customer demand and current retail trends, which are likely to have contributed to same-store sales in the fiscal first quarter. Further, its point-of-sale financing model that offers affordable credit products to its core customers remains an upside. Moreover, higher retail sales stemming from its in-house credit offering and new credit strategies might have aided the top line. Also, the company in its last earnings call noted that its lease-to-own sales continued to grow during the quarter under review.

Apart from these, it remains focused on enhancing its direct-to-consumer business and has been investing in the digital platform. Keeping in these lines, the company has been making efforts to improve its marketing strategy along with expanding the e-commerce team and omnichannel facilities. Also, brand awareness, next-day delivery and in-house service capabilities bode well. Conn’s e-commerce business has also been gaining from features launched in fiscal 2019, which enable online transactions with its in-house financing.

However, the company continues to reel under industry-wide supply-chain disruptions, which are likely to have affected the fiscal first-quarter results to some extent. Further, management in its last earnings call expected SG&A expenses to rise in the fiscal first quarter due to increased investments in e-commerce initiatives, new stores and other COVID-related expenses.

Conns, Inc. Price and EPS Surprise

Conns, Inc. Price and EPS Surprise
Conns, Inc. Price and EPS Surprise

Conns, Inc. price-eps-surprise | Conns, Inc. Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Conn’s 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.

Conn’s carries a Zacks Rank #1 but an Earnings ESP of 0.00%.

Other Stocks Poised to Beat Earnings Estimates

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 an earnings beat this season:

Signet Jewelers Limited SIG has an Earnings ESP of +2.84% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Darden Restaurant, Inc. DRI has an Earnings ESP of +4.70% and a Zacks Rank #3, at present.

Carmax, Inc. KMX currently has an Earnings ESP of +7.88% and a Zacks Rank #3.

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Darden Restaurants, Inc. (DRI) : Free Stock Analysis Report

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Conns, Inc. (CONN) : Free Stock Analysis Report

CarMax, Inc. (KMX) : Free Stock Analysis Report

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