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The Zacks Analyst Blog Highlights: Sea, Target, 1-800-FLOWERS.COM, Burlington and Cooper Companies

Zacks Equity Research

For Immediate Release

Chicago, IL –August 20, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Sea Ltd. SE, Target Corp. TGT, 1-800-FLOWERS.COM Inc. FLWS, Burlington Stores Inc. BURL and The Cooper Companies Inc. COO.

Here are highlights from Monday’s Analyst Blog:

5 Must-Buy Stocks Ahead of Earnings Reports

Wall Street is reeling under severe volatility since the beginning of August due to uncertainty related to trade-related conflicts, which resulted in the inversion of the main treasury yield curve.

Yields on the 2-year and the 10-year U.S. Treasury Notes inverted on Aug 14, for the first time since December 2005, raising concerns about an impending recession in the U.S. economy. However, the yield curve steadied the next day.

Meanwhile, second-quarter 2019 earnings results have so far come in better than expected. In spite of a prolonged trade conflict with China and limited hope of any near-term solution to the tariff war, there hasn’t been any broad-based decline in earnings although the pace has slowed. In line with better-than-expected earnings reports, five companies are set to beat earnings estimates this month.

Second-Quarter 2019 Earnings Results at a Glance

As of Aug 16, 460 S&P 500 members reported second-quarter earnings results. Total earnings for these 460 index members are up 0.4% from the same period last year on 4.8% higher revenues. Notably, 75.2% companies surpassed EPS estimates while 57.2% beat revenue estimates.

At present, total second-quarter earnings for the S&P 500 Index are expected to be up 0.2% from the prior-year period on 4.7% higher revenues. This is a massive improvement from an earnings decline of 3.4% on 3.9% higher revenues, expected in the beginning of the second-quarter earnings session.

Notably, Wall Street had witnessed negative earnings (0.2% earnings decline on 4.2% higher revenues) in the first quarter for the first time since the second quarter of 2016. (Read More: Retail Earnings in Focus)

5 Stocks Set to Beat on Earnings This Month

At this stage, it will be prudent to invest in stocks with a favorable Zacks Rank and positive Earnings ESP. Strong earnings results will likely ensure a northbound move in stock prices of these companies in the near term despite market volatility.

We have narrowed down our search to five companies, which will release their earnings results this month. Each of these stocks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy) and popped in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP, the chance of an earnings beat is as high as 70%.

Sea Ltd.is engaged in the digital entertainment, e-commerce and digital financial service businesses in Taiwan, Thailand, Vietnam, Indonesia and internationally. Sea Ltd. has an Earnings ESP of +4.35% for second-quarter 2019 and sports a Zacks Rank #1.  

The company has an expected earnings growth rate of 1.7% for the current quarter. The Zacks Consensus Estimate for the current quarter and year improved 3.3% and 5.7%, respectively, over the last 60 days.

The company delivered positive earnings surprise in two out of the last four quarters, with an average beat of 7.3%. The stock has jumped 123.6% in the past six months. Sea Ltd. is expected to release earnings results on Aug 20, before the opening bell.

Target Corp.operates large-format general merchandise and food discount stores in the United States, which include Target and SuperTarget stores. Target has an Earnings ESP of +1.04% for second-quarter 2019 and carries a Zacks Rank #2.

The company has an expected earnings growth rate of 9.5% and 9.8% for the current quarter and year, respectively. The company delivered positive earnings surprise in three out of the last four quarters, with an average beat of 2.6%. The stock has surged 15.8% in the past six months. Target is expected to release earnings results on Aug 21, before the opening bell.

1-800-FLOWERS.COM Inc.provides gourmet food and floral gifts for various occasions in the United States. It operates in three segments: Consumer Floral, Gourmet Foods & Gift Baskets; and BloomNet Wire Service. 1-800-FLOWERS.COM has an Earnings ESP of +6.67% for the fourth quarter of fiscal 219 and a Zacks Rank #2.

The company delivered positive earnings surprise in the last four quarters at an average of 11.3%. The stock has gained 5.3% in the past six months. 1-800-FLOWERS.COM is expected to release earnings results on Aug 22, before the opening bell.

Burlington Stores Inc. operates as a retailer of branded apparel products in the United States. It offers fashion-focused merchandise, including women's ready-to-wear apparel, accessories, footwear, menswear, youth apparel, coats, toys, and gifts, as well as baby, home and beauty products.  Burlington Stores has an Earnings ESP of +1.13% for second-quarter 2019 and carries a Zacks Rank #2.

The company has an expected earnings growth rate of 8.9% for the current year. The Zacks Consensus Estimate for the current quarter improved 0.1% over the last 60 days.

The company delivered positive earnings surprise in the last four quarters at an average of 8.7%. The stock has gained 5.4% in the past six months. Burlington Stores is expected to release earnings results on Aug 29, before the opening bell.

The Cooper Companies Inc.operates as a medical device company worldwide. It operates through CooperVision and CooperSurgical business units. The Cooper Companies has an Earnings ESP of +1.50% for the third quarter of fiscal 2019 and carries a Zacks Rank #2.

The company has an expected earnings growth rate of 5.3% and 6.8% for the current quarter and year, respectively. The Zacks Consensus Estimate for the current year improved 0.3% over the last 60 days.

The company delivered positive earnings surprise in two out of the last four quarters, with an average beat of 4%. The stock has surged 17.9% in the past six months. The Cooper Companies is expected to release earnings results on Aug 29, after the closing bell.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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