Earnings week ahead: FedEx, General Mills, AutoZone and more
In the upcoming week, a select group of prominent companies will release their earnings reports, potentially influencing overall market sentiment. Notably, investors are eager for updates from FedEx (NYSE:FDX), General Mills (NYSE:GIS) and AutoZone (NYSE:AZO), among others.
Below is a rundown of major quarterly updates anticipated in the week of September 18 to 22:
Monday, September 18
Stitch Fix (NASDAQ:SFIX)
San Francisco-based online personal styling service Stitch Fix (SFIX) is set to post its Q4 earnings after the bell on Monday. Despite strong Q3 results, the company’s Q4 revenue guidance fell short of market expectations. The company also updated its cost-saving initiatives, which include reducing distribution centers from five to three and exploring an exit from the UK market.
Shares have lost almost 36% of their value over the last six months, prompting caution from both sell-side analysts and Seeking Alpha’s Quant rating system, which has assigned it a Hold recommendation.
In their analysis, Seeking Alpha author Welbeck Ash Research noted that SFIX has witnessed negative growth in five consecutive quarters due to a poor business model, a lack of a clear value proposition, limited brand selection, and impulsive retail spending. The company faces challenges in targeting a large market and protecting its position due to a lack of tangible assets.
- Consensus EPS Estimates: $-0.21
- Consensus Revenue Estimates: $371.98M
- Earnings Insight: The company has beaten EPS and revenue estimates in 50% of the past 8 quarters.
Tuesday, September 19
The Memphis-based auto part and accessory retailer AutoZone (AZO) will report its Q4 results before the bell on Tuesday. In its last quarterly report, the firm’s Q3 revenue fell short of consensus due to weather headwinds and some internal execution issues.
The stock, which increased 21% over the past year, has attracted a Buy rating from Wall Street analysts and Seeking Alpha’s Quant rating system.
“AutoZone’s strategic positioning and expansion into new markets will further enhance future earnings,” predicts SA author I.M. Investing.
- Consensus EPS Estimates: $45.29
- Consensus Revenue Estimates: $5.61B
- Earnings Insight: AutoZone has exceeded EPS and revenue estimates in 8 straight quarters.
Wednesday, September 20
FedEx (FDX) is set to deliver its Q1 print on Wednesday after the bell. Analysts expect the top line to decline Y/Y. In contrast to Seeking Alpha’s Quant rating system, which gives the stock a Hold recommendation due to growth concerns, Wall Street analysts have recommended buying the stock, which has climbed more than 45% on a YTD basis.
“Given the current valuation and looming recession risks, it may not provide a sufficient margin of safety for investors. “Consequently, while FedEx remains a market leader with a strong business model, there may be better investment opportunities available in the market for higher returns,” writes SA contributor DJTF Investments.
Last month, the company announced plans to increase shipping rates and customs clearance fees on imports after January 1, 2024, and updated demand surcharges and fees, with additional handling surcharges for U.S. Express Package Services, U.S. Ground Services, and International Ground Service, starting on October 2.
- Consensus EPS Estimates: $3.75
- Consensus Revenue Estimates: $21.81B
- Earnings Insight: FedEx (FDX) had beaten EPS estimates in 50% of the past 8 quarters, exceeding revenue expectations in just 3 of those quarters.
Thursday, September 21
Darden Restaurants (NYSE:DRI)
Darden Restaurants (DRI) is scheduled to announce its Q1 report before the market opens on Thursday. Analysts expect EPS and revenue to increase Y/Y.
SA author, The Gaming Dividend, points out that DRI offers investors a chance to boost cash flow and enjoy price appreciation with its globally recognized brands and increased dining out spending. The recent acquisition of Ruth Chris expands DRI’s fine dining portfolio with higher profit margins and sales growth.
Just a few days before the earnings, Seeking Alpha’s Quant rating system changed its recommendation on the stock from Buy to Hold, citing valuation concerns. Meanwhile, Wall Street analysts are optimistic about the stock with a consensus Buy recommendation.
- Consensus EPS Estimates: $1.73
- Consensus Revenue Estimates: $2.71B
- Earnings Insight: The company had beaten EPS and revenue estimates in 6 of the past 8 quarters.