Credit: Shutterstock photoBlack Diamond, Inc.BDE is set to report fourth-quarter 2015 results on Mar 14, after the market closes. Last quarter, the company posted a negative earnings surprise of 33.3%. However, Black Diamond has surpassed earnings estimates thrice in the trailing four quarters, with a significant average positive surprise of 95.61%.
Let's see how things are shaping up for the upcoming announcement.
Factors at Play
Black Diamond's revenues have gained consistently over the past few quarters supported by sales growth of Black Diamond apparel brand and the continued rollout of POC's cycling products, including the new spring 2015 "Race Day" line and expanded assortment of eyewear.
However, currency exchange continues to be a headwind as the dollar remains strong. Further, tough retail environment, combined with warmer-than-expected weather on the East Coast (that affected categories like gloves), are likely to keep revenues under pressure in the to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Black Diamond is likely to beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP : Black Diamond's Earnings ESP is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 2 cents.
Zacks Rank : Black Diamond has a Zacks Rank #4 (Sell).
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Stocks That Warrant a Look
Here are some stocks in the broader consumer discretionary sector that investors may consider, as our model shows that they have the right combination of elements to post an earnings beat this quarter:
American Public Education Inc. APEI , with an Earnings ESP of +11.11% and a Zacks Rank #1.
GIII Apparel Inc. GIII , with an Earnings ESP of +7.14% and a Zacks Rank #3.
Prestige Brands, Inc. PBH , with has an Earnings ESP of +2.04% and a Zacks Rank #3.
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AMER PUB EDUCAT (APEI): Free Stock Analysis Report
BLACK DIAMOND (BDE): Free Stock Analysis Report
PRESTIGE BRANDS (PBH): Free Stock Analysis Report
G-III APPAREL (GIII): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
