), the office supplies retailer, is slated to post fourth quarter
and fiscal 2013 results of Mar 6, 2014. In the last quarter,
earnings of 42 cents a share came in line with the Zacks
Consensus Estimate. Let's see how things are shaping up for this
Factors this Past Quarter
In the previous quarter, lower sales on account of store closures
and lower product margins took a toll on Staple's earnings.
Margins contracted primarily due to reduced product margins,
unfavorable impact of fixed expenses on reduced sales and
investments related to the company's strategic initiatives. These
negatives were offset by savings pertaining to headcount
reductions and fall in marketing expense and equity compensation.
However, given the decline in business and consumer spending in
the wake of the global meltdown, the office supply retailers are
going through a rough patch.
Our proven model does not conclusively show that Staples is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive
(Expected Surprise Prediction) and a Zacks Rank of #1, 2 or 3 for
this to happen. That is not the case here as you will see below.
Negative Zacks ESP
: Staples currently has an Earnings ESP of -2.56%. This is
because the Most Accurate estimate stands at 38 cents, while the
Zacks Consensus Estimate is pegged at 39 cents.
Zacks Rank #4 (Sell)
: Staples holds a Zacks Rank #4 (Sell). We caution against stocks
with Zacks #4 and #5 Ranks (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 this quarter:
Crown Castle International Corp.
), Earnings ESP of +3.57% and a Zacks Rank #2 (Buy).
), Earnings ESP of +2.94% and a Zacks Rank #1 (Strong Buy).
), Earnings ESP of +1.80% and a Zacks Rank #2 (Buy).
AUTOZONE INC (AZO): Free Stock Analysis
BALL CORP (BLL): Free Stock Analysis Report
CROWN CASTLE (CCI): Free Stock Analysis
STAPLES INC (SPLS): Free Stock Analysis
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