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Buffalo Wild Wings (BWLD) Q2 Earnings: What's in Store?
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Buffalo Wild Wings Inc. is set to report second-quarter 2016 results on Jul 26, after the market closes.
Last quarter, the restaurant posted a negative earnings surprise of 1.70%. In fact, the company posted negative earnings surprises in all of the trailing four quarters with an average of a negative 11.22%. Let’s see how things are shaping up for this announcement.
Factors to Consider
Buffalo Wild Wings has been witnessing positive comps over the past several quarters driven by its strong market position and new menu launches. Also, the company’s associations with the National Collegiate Athletic Association (“NCAA”) and growing beverage chains should expand its brand portfolio. Factors like these bode well for the company’s results in to-be-reported quarter.
Further, Buffalo Wild Wings upgraded its website and mobile app to create a better take-out ordering experience for guests during 2015. We expect the company to have witnessed increase in take-out orders in the second quarter as well.
However, the company expects higher operating expenses in the second quarter. This is due to higher selling, general and administrative expenses and increase in the cost of traditional wings.
Moreover, high chicken and labor costs have been hurting the company’s profits over the past few quarters. Stiff competition and the addition of Guest Experience Captains at its restaurants are other headwinds.
Earnings Whispers
Our proven model does not conclusively show that Buffalo Wild Wings is likely to beat earnings 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. Unfortunately, that is not the case here, as elaborated below.
Zacks ESP: Earnings ESP for Buffalo Wings is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.26.
Zacks Rank: BuffaloWild Wings currently holds a Zacks Rank #2, which when combined with an ESP of 0.00% makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Rank #4 and 5) going into the earnings announcement, especially when the company is seeing a negative estimate revisions.
Stocks to Consider
Here are some companies in the retail wholesale sector that you may consider, as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Amazon.com Inc. (AMZN - Free Report) with an Earnings ESP of +37.72% and a Zacks Rank #3.
Five Below, Inc. (FIVE - Free Report) with an Earnings ESP of +5.88% and a Zacks Rank #2.
Big Lots Inc. (BIG - Free Report) with an Earnings ESP of +4.35% and a Zacks Rank #2.
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 >>
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Buffalo Wild Wings (BWLD) Q2 Earnings: What's in Store?
Buffalo Wild Wings Inc. is set to report second-quarter 2016 results on Jul 26, after the market closes.
Last quarter, the restaurant posted a negative earnings surprise of 1.70%. In fact, the company posted negative earnings surprises in all of the trailing four quarters with an average of a negative 11.22%. Let’s see how things are shaping up for this announcement.
Factors to Consider
Buffalo Wild Wings has been witnessing positive comps over the past several quarters driven by its strong market position and new menu launches. Also, the company’s associations with the National Collegiate Athletic Association (“NCAA”) and growing beverage chains should expand its brand portfolio. Factors like these bode well for the company’s results in to-be-reported quarter.
BUFFALO WLD WNG Price and EPS Surprise
BUFFALO WLD WNG Price and EPS Surprise | BUFFALO WLD WNG Quote
Further, Buffalo Wild Wings upgraded its website and mobile app to create a better take-out ordering experience for guests during 2015. We expect the company to have witnessed increase in take-out orders in the second quarter as well.
However, the company expects higher operating expenses in the second quarter. This is due to higher selling, general and administrative expenses and increase in the cost of traditional wings.
Moreover, high chicken and labor costs have been hurting the company’s profits over the past few quarters. Stiff competition and the addition of Guest Experience Captains at its restaurants are other headwinds.
Earnings Whispers
Our proven model does not conclusively show that Buffalo Wild Wings is likely to beat earnings 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. Unfortunately, that is not the case here, as elaborated below.
Zacks ESP: Earnings ESP for Buffalo Wings is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.26.
Zacks Rank: BuffaloWild Wings currently holds a Zacks Rank #2, which when combined with an ESP of 0.00% makes surprise prediction difficult.
We caution against Sell-rated stocks (Zacks Rank #4 and 5) going into the earnings announcement, especially when the company is seeing a negative estimate revisions.
Stocks to Consider
Here are some companies in the retail wholesale sector that you may consider, as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Amazon.com Inc. (AMZN - Free Report) with an Earnings ESP of +37.72% and a Zacks Rank #3.
Five Below, Inc. (FIVE - Free Report) with an Earnings ESP of +5.88% and a Zacks Rank #2.
Big Lots Inc. (BIG - Free Report) with an Earnings ESP of +4.35% and a Zacks Rank #2.
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 >>