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Stitch Fix (SFIX) to Report Q1 Earnings: What's in the Cards?

Stitch Fix, Inc. SFIX is expected to register a decrease in both its top and the bottom line from the year-ago fiscal quarter’s reported figure in its first-quarter fiscal 2023 earnings on Dec 6, after market close. The Zacks Consensus Estimate for quarterly revenues currently stands at $459.7 million, suggesting a 20.9% decrease from the year-ago fiscal quarter’s tally.

The Zacks Consensus Estimate for the fiscal first quarter’s loss is pegged at 44 cents, wider than the loss of 2 cents a share recorded in the year-earlier fiscal quarter. The consensus estimate has been stable over the past 30 days.

This online personal-styling service provider delivered an earnings surprise of 12.5% in the trailing four quarters, on average.

Factors at Play

Stitch Fix’s quarterly performance is likely to be hurt by a tough macroeconomic environment, including headwinds like supply-chain issues, global inflationary pressures and potential shifts in customer demand. These factors coupled with any deleverage in selling, general and administrative expenses might have affected SFIX’s performance in the fiscal first quarter. In addition, elevated investments in the Freestyle drive and new channels are concerning.

On its last earnings call, management had projected net revenues of $455-$465 million for the fiscal first quarter, indicating a decline of 20-22% from the year-ago fiscal quarter’s reported figure. Stitch Fix anticipated adjusted EBITDA between a negative $10 million and a negative $15 million, with a margin contraction of 2-3%. This view assumes net active clients to decline from the sequential quarter’s level.

However, Stitch Fix has been expanding its digital capabilities and personalized shopping for a while to offer clients the best-in-class service. SFIX’s Freestyle drive offering quite a distinct shopping experience is encouraging. This platform enables customers to discover and buy curated items according to their style, preferences, fit and size.

What Does the Zacks Model Say?

Our proven model does not conclusively predict an earnings beat for Stitch Fix 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 as elaborated below. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Stitch Fix, Inc. Price and EPS Surprise

Stitch Fix, Inc. Price and EPS Surprise
Stitch Fix, Inc. Price and EPS Surprise

Stitch Fix, Inc. price-eps-surprise | Stitch Fix, Inc. Quote

Stitch Fix currently has a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks With Favorable Combination

Here are three companies worth considering as our model shows that these have the right combination of elements to beat on earnings this season:

lululemon athletica LULU currently has an Earnings ESP of +1.50% and a Zacks Rank #2. LULU is likely to register an increase in the bottom line from the year-ago fiscal quarter’s reported figure in its third-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings has been stable at $1.95 per share over the past 30 days, suggesting 20.4% growth from the year-ago fiscal quarter’s reported number. You can see the complete list of today’s Zacks #1 Rank stocks here.

lululemon athletica’s top line is expected to rise from the prior-year fiscal quarter’s reported number. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.80 billion, suggesting a 24.4% rise from the figure reported in the prior-year fiscal quarter. LULU delivered an earnings beat of 10.4%, on average, in the trailing four quarters.

Dollar General DG currently has an Earnings ESP of +2.35% and a Zacks Rank #3. DG is likely to register top-line growth from the year-ago fiscal quarter’s tally in its third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $9.43 billion, suggesting 10.7% growth from the figure reported in the prior-year fiscal quarter.

The Zacks Consensus Estimate for Dollar General’s earnings for the fiscal third quarter is pegged at $2.54 per share, suggesting 22.1% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DG delivered an earnings beat of 2.2%, on average, in the trailing four quarters.

Dollar Tree DLTR has an Earnings ESP of +6.57% and a Zacks Rank of 3, currently. DLTR is likely to register top-line growth from the year-earlier fiscal quarter’s actuals in its third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.83 billion, suggesting 6.5% growth from the figure reported in the prior-year fiscal quarter.

The Zacks Consensus Estimate for Dollar Tree’s earnings for the fiscal third quarter is pegged at $1.16 per share, suggesting 20.8% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DLTR delivered an earnings beat of 8.6%, on average, in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Dollar General Corporation (DG) : Free Stock Analysis Report

Dollar Tree, Inc. (DLTR) : Free Stock Analysis Report

lululemon athletica inc. (LULU) : Free Stock Analysis Report

Stitch Fix, Inc. (SFIX) : Free Stock Analysis Report

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