Big Lots Inc.
), the broadline closeout retailer, is set to report second-quarter
fiscal 2014 results on Aug 29 2014. Last quarter, the company
posted a positive earnings surprise of 13.6%. Let us see how
things are developing prior to this announcement.
Factors Affecting this Quarter
Soft economic recovery and sluggish consumer spending especially
discretionary continue to mar retail sector, and Big Lots is no
exception. Like several retailers the company too has launched a
turnaround strategy, which includes cost trimming, online expansion
and scaling back operations, to recover the lost momentum. However,
these efforts continue to be a time consuming affair.
Our proven model does not conclusively project Big Lots as likely
to beat earnings this quarter. This is because a stock needs to
have both a positive
and Zacks Rank #1 2 or 3 for this to happen. This is not the case
here as you will see below.
Big Lots currently has an Earnings ESP of 0.00%. This is
because both the Most Accurate estimate and the Zacks Consensus
Estimate stand at 30 cents per share.
Big Lots' Zacks Rank #3 (Hold) increases the predictive power of
ESP. However, we need to have a positive ESP to be confident about
an earnings surprise.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated
stocks) going into an earnings announcement, especially when the
company is witnessing negative estimate revisions.
Other Stocks to Consider
Here are some other companies you may want to consider as our model
shows these have the right combination of elements to post an
Abercrombie & Fitch Co. (
) has an Earnings ESP of +10.00% and a Zacks Rank #2 (Buy).
Zoe's Kitchen, Inc. (
) has an Earnings ESP of +50.00% and a Zacks Rank #2.
Shoe Carnival Inc. (
) has an Earnings ESP of +5.88% and a Zacks Rank #2.
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