Here's How Central Garden & Pet (CENT) Looks Before Q2 Earnings
Central Garden & Pet Company CENT is likely to register top- and bottom-line growth when it reports second-quarter fiscal 2021 numbers on May 5, after the closing bell. The Zacks Consensus Estimate for its quarterly revenues is pegged at $874.8 million, which indicates an increase of above 24% from the year-ago figure. Markedly, the company witnessed top-line growth of 22.7% in the last reported quarter.
The Zacks Consensus Estimate for quarterly earnings is currently pegged at $1.08, which indicates an improvement of more than 38% from 78 cents in the year-ago quarter. Also, the consensus mark has moved up by 7 cents in the past 30 days. Notably, the company’s bottom line surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average earnings surprise being 221.2%.
Keys Aspects to Note
With more time being spent indoors amid the pandemic, individuals have been devoting time to take care of pets and indulge in gardening activities. The trend is likely to continue to benefit the company’s Pet and Garden segments. Markedly, these segments have been performing well and driving the overall top line. In the pet unit, the company has been gaining from strong sales of dog and cat, distribution and small animal supplies. The garden unit is benefiting from wild bird feed, grass seed, fertilizers and live plants categories.
Growth in these segments has most likely aided the company’s top line in the fiscal second quarter. The Zacks Consensus Estimate for fiscal second-quarter sales in the Pet and Garden segments is currently pegged at $401 million and $479 million, respectively, suggesting an increase of 11% and 40%.
Additionally, quarterly results are likely to reflect contributions and product expansions resulting from buyouts of Green Garden, Hopewell Nursery, C&S Products and Bell Nursery among others. Moreover, the acquisition of DoMyOwn.com, which is a fast-growing online retailer of professional-grade control products, has likely aided the company’s performance in the quarter under review. The company has also been developing new products, advancing digital capabilities, optimizing supply chain, and focusing on marketing activities.
However, escalated SG&A expenses raise concern. Higher investments related to capacity expansion, brand building and e-commerce, and a spike in labor and freight costs as well as key commodity prices might have weighed on the quarterly performance.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Central Garden & Pet 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. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Central Garden & Pet Company Price and EPS Surprise
Central Garden & Pet Company price-eps-surprise | Central Garden & Pet Company Quote
Although Central Garden & Pet sports a Zacks Rank #1, its Earnings ESP of -7.12% makes surprise prediction difficult.
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