Will Big Lots (BIG) Miss Estimates? - Analyst Blog
Big Lots Inc.
), one of the leading retailers specializing in closeout
merchandise and toys, is slated to post fourth quarter and fiscal
2013 results on Mar 7, 2014. In the last quarter, it delivered a
negative earnings surprise of -100%. Let's see how things are
shaping up for this announcement.
Factors this Past Quarter
Big Lots posted dismal third-quarter fiscal 2013 results in which the company's losses widened from the Zacks Consensus Estimate and also from the prior-year quarter loss. Although the top line showed a marginal year-on-year growth, it fell short of the Zacks Consensus Estimate.
Consequently, Big Lots trimmed its earnings forecast. Waning
domestic comparable-store sales, sluggish sales of discretionary
items in a low income consumer environment, and soft sales of
higher margin seasonal products remain the company's key
Our proven model does not conclusively show that Big Lots is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP (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 : Big Lots currently has an Earnings ESP of -10.56%. This is because the Most Accurate estimate stands at $1.27, while the Zacks Consensus Estimate is pegged at $1.42.
Zacks Rank : Big Lots' Zacks Rank #3 (Hold), when combined with negative ESP, makes surprise prediction difficult. We caution against stocks with a Zacks Rank #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 these have the right combination of elements to post an earnings beat this quarter:
American Airlines Group Inc. ( AAL ), Earnings ESP of +13.56% and a Zacks Rank #1 (Strong Buy).
TD Ameritrade Holding Corp. ( AMTD ), Earnings ESP of +6.25% and a Zacks Rank #1 (Strong Buy).
American Financial Group Inc. ( AFG ), Earnings ESP of +2.00% and a Zacks Rank #1 (Strong Buy).
AMER AIRLINES (AAL): Free Stock Analysis Report
AMER FINL GROUP (AFG): Free Stock Analysis Report
TD AMERITRADE (AMTD): Free Stock Analysis Report
BIG LOTS INC (BIG): Free Stock Analysis Report
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