Wolverine (WWW) to Report Q3 Earnings: What's in the Offing?
Wolverine World Wide, Inc. WWW is expected to report a decrease in its top line from the year-ago quarter’s reported figure when it releases third-quarter 2023 results on Nov 9 before market open. The Zacks Consensus Estimate of $516 million for quarterly revenues suggests a fall of 25.3% from the prior-year quarter’s tally.
The consensus estimate for the quarterly bottom line has been stable in the past 30 days at 7 cents per share. The figure indicates a sharp decline from earnings of 48 cents a share in the year-earlier quarter.
In the trailing four quarters, this Rockford, MI-based player delivered an earnings surprise of 13%, on average.
Key Factors to Note
Wolverine’s quarterly results are likely to have been hurt by a challenging operating landscape including the inflationary pressures and adverse currency fluctuations. Also, a tough year-over-year comparison has been hurting the company’s performance. The company has been witnessing weak margins for a while now owing to increased promotions and higher costs. These limitations, coupled with any deleverage in selling, general and administrative expenses, are likely to have weighed upon the company’s performance during the quarter under review.
On its last earnings call, management had forecast revenues to be $515 million, reflecting a year-over-year decline of about 21%. This includes impacts from tough comparisons with the year-ago period, wherein the company saw unusually high shipments to third-party distributors owing to a timing shift. For the third quarter, WWW had projected adjusted gross margin to be 42%, which includes $12 million of transitory supply-chain costs expected in the quarter. Our model suggests that the adjusted operating margin is likely to decline 450 basis points for the third quarter.
Wolverine expects adjusted earnings per share to be 5-10 cents for the third quarter, down from earnings of 48 cents per share recorded in the year-ago quarter. The outlook reflects July trends and expectations of these trends to linger throughout the quarter.
On the flip side, Wolverine’s commitment to product innovation, investment in digitization and international expansion appear encouraging. Management is also strengthening its direct-to-consumer capabilities. Speed-to-market initiatives, deployment of the digital product development tool and expansion of e-commerce platforms are other positives.
What Our Zacks Model Says
Our proven model doesn’t conclusively predict an earnings beat for Wolverine 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 before they’re reported with our Earnings ESP Filter.
Wolverine World Wide, Inc. Price and EPS Surprise
Wolverine World Wide, Inc. price-eps-surprise | Wolverine World Wide, Inc. Quote
Wolverine has an Earnings ESP of 0.00% and a Zacks Rank of 2.
Stocks With the Favorable Combination
Here are three companies, which according to our model, have the right combination of elements to beat on earnings this reporting cycle:
Build-A-Bear Workshop BBW currently has an Earnings ESP of +0.66% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for third-quarter fiscal 2023 earnings per share is pegged at 51 cents, flat year over year.
Build-A-Bear Workshop’s top line is expected to increase year over year. The consensus estimate for quarterly revenues is pegged at $107.6 million, which indicates an increase of 3% from the figure reported in the prior-year quarter. BBW has a trailing four-quarter earnings surprise of 21.6%, on average.
Costco COST currently has an Earnings ESP of +2.02% and a Zacks Rank of 2. COST is likely to register a bottom-line increase when it reports first-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of $3.43 suggests an increase of 10.7% from the year-ago fiscal quarter’s reported number.
Costco’s top line is expected to improve from the prior-year fiscal quarter’s reported number. The consensus estimate for quarterly revenues is pegged at $57.9 billion, suggesting growth of 6.3% from the prior-year fiscal quarter’s reported figure. COST has a trailing four-quarter earnings surprise of 2.1%, on average.
NIKE NKE currently has an Earnings ESP of +0.45% and a Zacks Rank of 3. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for NKE’s quarterly earnings per share of 85 cents remains flat year over year.
NIKE has a trailing four-quarter earnings surprise of 27.1%, on average. The consensus estimate for NKE’s quarterly revenues is pegged at $13.4 billion, indicating a rise of 0.7% from the figure reported in the prior-year quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
NIKE, Inc. (NKE) : Free Stock Analysis Report
Costco Wholesale Corporation (COST) : Free Stock Analysis Report
Wolverine World Wide, Inc. (WWW) : Free Stock Analysis Report
Build-A-Bear Workshop, Inc. (BBW) : Free Stock Analysis Report
