Sprouts Farmers Market, Inc. SFM is likely to register an increase in the top line when it reports first-quarter 2023 earnings on May 1 after market close. The Zacks Consensus Estimate for revenues stands at $1,722 million, indicating an increase of 5% from the prior-year reported figure.
The bottom line of this grocery retailer is also expected to have increased year over year. The Zacks Consensus Estimate for first-quarter earnings per share has been stable at 86 cents over the past 30 days, calling for an increase of 8.9%.
Sprouts Farmers has a trailing four-quarter earnings surprise of 12.5%, on average. In the last reported quarter, this Phoenix, AZ-based company surpassed the Zacks Consensus Estimate by a margin of 13.5%.
Factors to Note
Sprouts Farmers' focus on product innovation, technology and targeted marketing with everyday great pricing bodes well. It has been steadily expanding its presence in the natural organic space, given the huge demand in the segment. Management has been lowering operational complexity, optimizing production, improving the in-stock position and updating to smaller-format stores. Apart from these, the company has been trying to expand private-label offerings.
Cumulatively, the aforementioned factors are likely to have favorably impacted the top line. On its last earnings call, Sprouts Farmers guided comparable store sales growth of 1.5% to 2.5% for the first quarter compared with the 1.6% reported in the year-ago period. The company guided earnings in the band of 83-87 cents a share compared with 79 cents a share in the year-ago period.
Sprouts Farmers Market, Inc. Price, Consensus and EPS Surprise
Sprouts Farmers Market, Inc. price-consensus-eps-surprise-chart | Sprouts Farmers Market, Inc. Quote
Sprouts Farmers is focused on creating a robust omnichannel experience. The company has been providing hassle-free shopping through the Sprouts.com website and mobile app and creating a supply chain that provides the freshest produce. We note that an in-store Pick-up & Delivery facility is available to all customers across all stores and markets. Such initiatives have been helping Sprouts Farmers expand its customer base and revenues.
Despite these tailwinds, elevated marketing spends, an increase in labor costs and higher commodity prices remain concerns. These might have weighed on the company's margins.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Sprouts Farmers this time. 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, which is not the case here.
Sprouts Farmers currently has a Zacks Rank #2 and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
3 Stocks With the Favorable Combination
Here are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Kroger KR currently has an Earnings ESP of +2.56% and sports a Zacks Rank #1. The company is likely to register a bottom-line decline when it reports first-quarter fiscal 2023 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $1.41 suggests a decline from the $1.45 reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kroger's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $45.38 billion, which indicates an improvement of 1.7% from the figure reported in the prior-year quarter. KR has a trailing four-quarter earnings surprise of 9.8%, on average.
Tractor Supply Company TSCO currently has an Earnings ESP of +0.30% and a Zacks Rank of 3. The company is likely to register an increase in the bottom line when it reports first-quarter 2023 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $1.69 suggests a rise of 2.4% from the year-ago reported number.
Tractor Supply's top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.30 billion, which suggests an increase of 9.2% from the prior-year quarter. TSCO has a trailing four-quarter earnings surprise of 5.6%, on average.
BJ's Wholesale Club BJ currently has an Earnings ESP of +6.76% and a Zacks Rank of 2. The company is likely to register a top-line increase when it reports first-quarter fiscal 2023 results. The consensus mark for BJ’s quarterly revenues is pegged at $4.8 billion, which suggests a jump of 6.8% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for BJ's Wholesale’s bottom line has remained unchanged at 84 cents per share in the past 30 days. The consensus estimate indicates a 3.5% drop from the year-ago quarter’s reported figure.
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