L Brands, Inc.
), a specialty retailer of women's intimate and other apparel,
beauty and personal care products, is set to report its
first-quarter fiscal 2013 results on May 22. In the last quarter
it posted a positive surprise of 1.2%. Let's see how things are
shaping up for this announcement.
Growth Factors this Past Quarter
Limited Brands' sustained focus on cost containment, inventory
management, and merchandise initiatives have kept it afloat in a
sluggish consumer environment. The company's Bath & Body
Works segment is gaining traction, driven by a rise in store
transactions, enhancement in the direct channel business and
growth in new stores. Victoria's Secret Stores has been
performing well and the company is also revamping its La Senza
Our proven model does not conclusively show that Limited
Brands is likely to beat earnings this quarter. That is because a
stock needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
)and a Zacks Rank of #1, #2 or #3 for this to happen. This is not
the case here as you will see below.
ESP for Limited Brands is 0.00%. This is because the Most
Accurate Estimate stands at 46 cents, which is in line with the
Zacks Consensus Estimate.
Zacks Rank #3 (Hold):
Limited Brands' Zacks Rank #3 (Hold) lowers the predictive power
of ESP because the Zacks Rank #3 when combined with a 0.00% ESP
makes surprise prediction difficult. We caution against stocks
with Zacks Ranks #4 and #5 (Sell rated stocks) going into the
earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat:
Flowers Foods, Inc.
) with an Earnings ESP of +9.38% and a Zacks Rank #1 (Strong
J&J Snack Foods Corp.
) with an Earnings ESP of +0.90% and a Zacks Rank #2 (Buy).
ConAgra Foods, Inc.
) with an Earnings ESP of +1.70% and a Zacks Rank #3 (Hold).
CONAGRA FOODS (CAG): Free Stock Analysis
FLOWERS FOODS (FLO): Free Stock Analysis
J&J SNACK FOODS (JJSF): Free Stock Analysis
L BRANDS INC (LTD): Free Stock Analysis
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