Etsy, Chuy's Holdings, Snap, Zillow Group and Planet Fitness highlighted as Zacks Bull and Bear of the Day

Shutterstock photo

For Immediate Release

Chicago, IL - November 8, 2017 - Zacks Equity Research highlights Etsy, Inc. ETSY as the Bull of the Day and Chuy's Holdings, Inc. CHUY as the Bear of the Day. In addition, Zacks Equity Research provides analysis on  Snap Inc. SNAPZillow Group Inc. ZG and Planet Fitness PLNT .

Here is a synopsis of all five stocks:

Bull of the Day

Etsy, Inc. is still on track with its turnaround to finish out its first profitable year as a public company. This Zacks Rank #1 (Strong Buy) recently beat the Zacks Consensus for the second straight quarter.

Etsy is the online market place where people make, sell and buy unique goods. Founded in 2005, it is headquartered in Brooklyn and went IPO in 2015.

A Big Third Quarter Earnings Beat

On Nov 6, Etsy reported third quarter results and beat the Zacks Consensus Estimate by 7 cents. Earnings were $0.12 compared to the consensus of just $0.05.

Revenue jumped 21.5% to $106.4 million driven by growth in both Markets and Seller Services. Markets rose 11.2% year-over-year due to growth in transaction fee revenue and, to a lesser extent, in listing fee revenue.

Seller Services revenue rose by 30.6% compared to the year ago quarter due to growth in Etsy Payments and Promoted Listings, and, to a lesser extent, Shipping Labels and Pattern.

Gross margin, however, fell 70 bps to 65.8% from 66.5% in the year ago quarter.

Gross Merchandise Sales (GMS) jumped 13.2% year-over-year, accelerating by 140 bps from the second quarter.

Active sellers rose 10.8% while active buyers increased 16.7% year-over-year.

Reiterated Full Year Guidance

Etsy's turnaround plan is proceeding. Following up this strong quarter, it reiterated full year guidance. GMS is expected to rise between 12-14% year-over-year. Revenue is expected in the range of 18-20%.

For the first three quarters of this year, GMS has averaged 13% while Revenue growth has been 19.6%.

Therefore, given the guidance, fourth quarter looks to be similar to the third quarter. The company said it was well positioned for the holiday season.

Further Upside?

Shares are up 43% year-to-date thanks to management changes, including a new CEO, and the turnaround plan.

Bear of the Day :

Chuy's Holdings, Inc. took a hit from Hurricanes Harvey and Irma and higher labor costs in the third quarter. This Zacks Rank #5 (Strong Sell) is expected to see a 10% decline in earnings this year.

Chuy's is a Texas-based Tex-Mex restaurant chain. It operates 88 full-service restaurants across 19 states where each location offers a unique "unchained" look and feel.

An Earnings Miss in the Third Quarter

On Nov 2, Chuy's reported third quarter results which missed the Zacks Consensus by 3 cents. Earnings were $0.19 versus the consensus of $0.22.

It was the company's first earnings miss since 2014.

Revenue rose 7.7% to $92.2 million from $85.6 million in the year ago period, but was hit by Hurricanes Harvey and Irma to the tune of about $1.2 million. Chuy's is headquartered in Austin, Texas and has a lot of Texas locations.

Comparable restaurant sales, which is the key metric for the industry, fell 2.1% year-over-year. The hurricanes impacted that number negatively by about 90 basis points, so it still would have been in the negative, even without the hurricanes.

Comps fell due to a 3.7% decrease in the average weekly customers offset by a 1.6% increase in average check.

However, it did see some improvement in comps in September and they were "slightly positive to date through the month of October."

Total restaurant operating costs as a percentage of revenue rose to 84.1% from 81% in the prior year due to decreased sales from the hurricanes as well as higher labor costs due to hourly labor rate inflation, increases in repairs and maintenance and insurance costs and unfavorable commodity pricing.

Chuy's continued to expand, opening 2 new restaurants in the third quarter and expects to open up 2 new restaurants in the fourth quarter for a total of 11 new restaurants in 2017. It will continue to expand in 2018, with 8 to 12 sites on the docket.

Lowered Full Year Guidance

Like the entire restaurant industry, Chuy's cited the "challenging" environment in its earnings report.

It lowered its full year earnings guidance to the range of $0.96 to $1.00 from its previous range of $1.04 to $1.08.

As a result, 6 analysts cut estimates which lowered the Zacks Consensus to $0.97 from $1.04. That's at the low end of the company's new guidance range.

Additional content:

SNAP Falls on Q3 Miss; Zillow, Planet Fitness Beat and Raise

Snap Inc. shares fell off a table in the after-market following its disappointing quarterly top and bottom-line results. The smartphone app maker posted a one-cent beat to -14 cents per share, but revenues of $207.9 million was well below the $236.9 million analysts had been expecting. Daily active users (DAU) reached 178 million in the quarter, also lower than expectations of 182 million.

The company noted a 4% increase in daily snaps to 3.5 billion, and cited app redesign costs as part of the reason for the company's sales miss in the quarter. Shares had fallen as much as 21% in late trading, but have gained a few points back in the minutes since then.  For more info on SNAP's earnings, click here.

Online real estate service Zillow Group Inc., on the other hand, beat both top and bottom-lines expectations in its most recently reported quarter: 19 cents per share beat the consensus estimate by 2 cents, while $282 million in sales topped the $277 million expected. Zillow also ratcheted up its top range of Q4 revenue guidance to $279 million, well ahead of the $274.5 million in the previous consensus.  Shares have climbed 2.5% in late trading. For more info on Z's earnings, click here.

And Planet Fitness (PLNT) impressed analysts with a big revenue beat as well as a 3-cent per share positive earnings surprise to 19 cents. Sales reached $97.5 million, well beyond the $93.7 million in the Zacks consensus. The Zacks Rank #2 (Buy)-rated stock also upped revenue guidance to $425-30 million, easily surpassing the $416 million we had been expecting.

Want more stock market analysis from this author? Make sure to follow @ Ryan_McQueeney  on Twitter!

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.  See This Ticker Free >>

About the Bull and Bear of the Day

Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.

Follow us on Twitter:  http://twitter.com/zacksresearch

Join us on Facebook:  http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339



Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer .

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Etsy, Inc. (ETSY): Free Stock Analysis Report

Zillow Group, Inc. (ZG): Free Stock Analysis Report

Snap Inc. (SNAP): Free Stock Analysis Report

Planet Fitness, Inc. (PLNT): Free Stock Analysis Report

Chuy's Holdings, Inc. (CHUY): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks
Referenced Symbols: ETSY , ZG , SNAP , PLNT , CHUY

More from Zacks.com




Equity Research

Research Brokers before you trade

Want to trade FX?