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Panera (PNRA) Q4 Earnings: What's in Store this Season?
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Panera Bread Company is scheduled to report fourth-quarter and full-year 2016 numbers on Feb 7, after the market closes.
Last quarter, Panera delivered a 2.24% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average beat of 3.39%.
Let’s see how things are shaping up for this announcement.
The company’s Panera 2.0 program, menu innovation, promotional strategies and new store design have started yielding results, with sales inching up at the converted restaurants. We expect sales to continue improving in the fourth quarter.
Meanwhile, Panera’s endeavor to remove all artificial ingredients from its food continues to enhance its popularity among the health-conscious consumers. Additionally, sound marketing initiatives and the company’s loyalty program should boost the quarter’s results.
Furthermore, Panera’s digitally enabled larger party-sized channels such as delivery, catering, Rapid Pick-Up, along with its Panera At Home business are driving incremental sales at the company. In fact this should turn out to be a strong revenue growth driver in the quarter.
However, the company is incurring heavy costs for implementing the initiatives under Panera 2.0. Also, massive investments along with increased labor and other expenses might offset the positives of the company’s strategic efforts, thereby hurting the quarter’s profits.
Moreover, a soft consumer spending environment in the U.S. restaurant space might hurt traffic and comps in the to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Panera is likely to beat the Zacks Consensus Estimate this quarter. This 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: Panera has an Earnings ESP of -0.50%. This is because the Most Accurate estimate stands at $1.99 per share, while the Zacks Consensus Estimate is pegged higher at $2.00. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Panera has a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s negative ESP makes surprise prediction difficult.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies in the broader Retail-Wholesale sector to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
YUM! Brands, Inc. (YUM - Free Report) has an Earnings ESP of +2.82% and a Zacks Rank #3.
Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +1.76% and a Zacks Rank #3.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 ""Strong Buy"" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 ""Strong Sells"" and other private research. See these stocks free >>
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Panera (PNRA) Q4 Earnings: What's in Store this Season?
Panera Bread Company is scheduled to report fourth-quarter and full-year 2016 numbers on Feb 7, after the market closes.
Last quarter, Panera delivered a 2.24% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, with an average beat of 3.39%.
Let’s see how things are shaping up for this announcement.
Panera Bread Company Price and EPS Surprise
Panera Bread Company Price and EPS Surprise | Panera Bread Company Quote
Factors Likely to Influence Q4 Results
The company’s Panera 2.0 program, menu innovation, promotional strategies and new store design have started yielding results, with sales inching up at the converted restaurants. We expect sales to continue improving in the fourth quarter.
Meanwhile, Panera’s endeavor to remove all artificial ingredients from its food continues to enhance its popularity among the health-conscious consumers. Additionally, sound marketing initiatives and the company’s loyalty program should boost the quarter’s results.
Furthermore, Panera’s digitally enabled larger party-sized channels such as delivery, catering, Rapid Pick-Up, along with its Panera At Home business are driving incremental sales at the company. In fact this should turn out to be a strong revenue growth driver in the quarter.
However, the company is incurring heavy costs for implementing the initiatives under Panera 2.0. Also, massive investments along with increased labor and other expenses might offset the positives of the company’s strategic efforts, thereby hurting the quarter’s profits.
Moreover, a soft consumer spending environment in the U.S. restaurant space might hurt traffic and comps in the to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Panera is likely to beat the Zacks Consensus Estimate this quarter. This 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: Panera has an Earnings ESP of -0.50%. This is because the Most Accurate estimate stands at $1.99 per share, while the Zacks Consensus Estimate is pegged higher at $2.00. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Panera has a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s negative ESP makes surprise prediction difficult.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies in the broader Retail-Wholesale sector to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Carrols Restaurant Group, Inc. (TAST - Free Report) has an Earnings ESP of +16.67% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
YUM! Brands, Inc. (YUM - Free Report) has an Earnings ESP of +2.82% and a Zacks Rank #3.
Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +1.76% and a Zacks Rank #3.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 ""Strong Buy"" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 ""Strong Sells"" and other private research. See these stocks free >>