Michael Kors Holding Ltd.
), a global luxury lifestyle company, is slated to report
first-quarter fiscal 2015 results on Aug 4. In the last quarter, it
posted a positive surprise of 14.7%. Let's see how things are
shaping up for this announcement.
Factors Influencing This Quarter
Michael Kors sells products that are discretionary in nature,
and in turn, depend upon consumers' disposable income. With
consumer environment remaining soft, the company could suffer from
an intense promotional backdrop, which could weigh upon its
margins. The heightened promotional activity is assumed to prevail
in the retail sector for the long term, with the first quarter not
being any exception.
Our proven model does not conclusively show that Michael Kors is
likely to beat earnings estimates this quarter. This is because a
stock needs to have both a positive
and a Zacks Rank #1, 2 or 3 for this to happen. This is not the
case here, as you will see below.
Michael Kors has an Earnings ESP of -2.47%. This is because the
Most Accurate estimate stands at 79 cents, while the Zacks
Consensus Estimate is pegged higher at 81 cents.
Michael Kors has a Zacks Rank #3 (Hold) but we need to have a
positive ESP to be confident about an earnings surprise. We caution
against stocks with Zacks Ranks #4 and 5 (Sell-rated) going into
the earnings announcement, especially when the company is seeing
negative estimate revisions.
Stocks That Warrant a Look
Here are some other companies you may want to consider as our
model shows that these have the right combination of elements:
Chipotle Mexican Grill, Inc. (
) has an Earnings ESP of +0.79% and a Zacks Rank #1 (Strong
Abercrombie & Fitch Co. (
) has an earnings ESP of +18.18% and a Zacks Rank #2 (Buy).
Conns Inc. (
) has an earnings ESP of +2.70% and a Zacks Rank #2.
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MICHAEL KORS (KORS): Free Stock Analysis Report
CHIPOTLE MEXICN (CMG): Free Stock Analysis
ABERCROMBIE (ANF): Free Stock Analysis Report
CONNS INC (CONN): Free Stock Analysis Report
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