Markets

Black Diamond (BDE) Q4 Earnings Preview: Will it Surprise?

A generic image of chart
Credit: Shutterstock photo

Black 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.

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 >>

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

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

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.


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

In This Story

GIII PBH APEI

Other Topics

Earnings Stocks

Latest Markets Videos

Zacks

Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

Learn More