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Chico's (CHS) to Report Q3 Earnings: What's in Store?

Chico's FAS Inc.CHS , one of the leading women's specialty retailers, is slated to report third-quarter fiscal 2015 results on Nov 24, 2015. In the last quarter, it posted a positive earnings surprise of 13.6%. Let's see how things are shaping up for this announcement.

Factors Influencing the Quarter

Although Chico's performance in the last quarter was quite commendable, the company may not display similar results in the quarter to be reported. For fiscal 2015, Chico's anticipates moderate positive comps. Moreover, the company expects the spread between overall sales and comparable-sales growth to be between 1% and 2%.

Further, the company has been facing challenges from a highly promotional and competitive retail scenario. To combat these challenges, the company has resorted to a number of new capital allocation and cost reduction initiatives..

Earnings Whispers

Our proven model does not conclusively project Chico's as likely to beat estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, #2 or #3 for this to happen. This is not the case here, as you will see below.

Zacks ESP: Earnings ESP for Chico's is 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 20 cents.

Zacks Rank: Chico's carries a Zacks Rank #3 (Hold). Though a favorable Zacks Rank increases the predictive power of ESP, the company's ESP of 0.00% makes surprise prediction difficult.

We caution against stocks with Zacks Rank #4 and 5 (Sell-rated stocks) going into an earnings announcement, especially when the company is witnessing negative estimate revisions.

Stocks That Warrant a Look

Here are some companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Casey's General Stores, Inc. CASY has an Earnings ESP of +12.50% and a Zacks Rank #1 (Strong Buy).

Signet Jewelers Limited SIG has an Earnings ESP of +2.63% and a Zacks Rank #2 (Buy).

Costco Wholesale Corporation COST has an Earnings ESP of +2.59% and a Zacks Rank #3.

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COSTCO WHOLE CP (COST): Free Stock Analysis Report

SIGNET JEWELERS (SIG): Free Stock Analysis Report

CHICOS FAS INC (CHS): Free Stock Analysis Report

CASEYS GEN STRS (CASY): 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.

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