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Will Adidas' (ADDYY) Earnings Beat Trend Continue in Q1?
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Adidas AG (ADDYY - Free Report) is slated to release first-quarter 2018 results on May 3. The question lingering in investors’ minds is whether this sporting goods behemoth will be able to deliver a positive earnings surprise in the quarter to be reported.
The company delivered a positive earnings surprise in the last reported quarter. Let’s see how things are shaping up prior to this announcement.
What to Expect?
The company’s current Zacks Consensus Estimate for the quarter under review is pegged at $1.55 per share, reflecting year-over-year growth of roughly 30.3%. We noted that the earnings estimate has been going up in the last 30 days. Further, analysts polled by Zacks expect revenues of $6.99 billion, up about 15.6% from the year-ago quarter.
Adidas’ shares have risen 15% in the last three months, outperforming the industry’s growth of 2.7%. The stock has been gaining from a positive earnings trend, with a beat recorded in the last five quarters. Further, strength in the Adidas brand, particularly in North America, alongside robust sales for the Reebok brand has been aiding the top line. Moreover, the company has been gaining from solid e-commerce growth, which is contributing significantly to top-line growth.
Together, these growth drivers, along with Adidas’ constant product launches and strong marketing initiatives, make us hopeful about the company’s prospects. However, management remained dissatisfied with its performance in Russia in the last reported quarter, which was hurt by ongoing challenging consumer environment and additional store closures.
Looking ahead, the company expects strong top- and bottom-line growth in 2018. It anticipates currency-neutral sales to advance nearly 10% in 2018, with double-digit growth expected in North America and Asia/Pacific regions. It envisions net income from continuing operations to improve 13-17% to €1.615-€1.675 billion. Let’s wait and see if Adidas can put up another impressive show this earnings season.
What the Zacks Model Unveils
Our proven model shows that Adidas is likely to beat earnings estimates this quarter. 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.
The company’s Earnings ESP of +0.21% and Zacks Rank #3 make us reasonably confident of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combination
Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Ralph Lauren Corp. (RL - Free Report) has an Earnings ESP of +2.92% and a Zacks Rank #2.
Urban Outfitters Inc. (URBN - Free Report) has an Earnings ESP of +0.62% and a Zacks Rank #2.
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Will Adidas' (ADDYY) Earnings Beat Trend Continue in Q1?
Adidas AG (ADDYY - Free Report) is slated to release first-quarter 2018 results on May 3. The question lingering in investors’ minds is whether this sporting goods behemoth will be able to deliver a positive earnings surprise in the quarter to be reported.
The company delivered a positive earnings surprise in the last reported quarter. Let’s see how things are shaping up prior to this announcement.
What to Expect?
The company’s current Zacks Consensus Estimate for the quarter under review is pegged at $1.55 per share, reflecting year-over-year growth of roughly 30.3%. We noted that the earnings estimate has been going up in the last 30 days. Further, analysts polled by Zacks expect revenues of $6.99 billion, up about 15.6% from the year-ago quarter.
Adidas AG Price, Consensus and EPS Surprise
Adidas AG Price, Consensus and EPS Surprise | Adidas AG Quote
Factors at Play
Adidas’ shares have risen 15% in the last three months, outperforming the industry’s growth of 2.7%. The stock has been gaining from a positive earnings trend, with a beat recorded in the last five quarters. Further, strength in the Adidas brand, particularly in North America, alongside robust sales for the Reebok brand has been aiding the top line. Moreover, the company has been gaining from solid e-commerce growth, which is contributing significantly to top-line growth.
Together, these growth drivers, along with Adidas’ constant product launches and strong marketing initiatives, make us hopeful about the company’s prospects. However, management remained dissatisfied with its performance in Russia in the last reported quarter, which was hurt by ongoing challenging consumer environment and additional store closures.
Looking ahead, the company expects strong top- and bottom-line growth in 2018. It anticipates currency-neutral sales to advance nearly 10% in 2018, with double-digit growth expected in North America and Asia/Pacific regions. It envisions net income from continuing operations to improve 13-17% to €1.615-€1.675 billion. Let’s wait and see if Adidas can put up another impressive show this earnings season.
What the Zacks Model Unveils
Our proven model shows that Adidas is likely to beat earnings estimates this quarter. 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.
The company’s Earnings ESP of +0.21% and Zacks Rank #3 make us reasonably confident of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Other Stocks With Favorable Combination
Here are some other companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Nordstrom Inc. (JWN - Free Report) has an Earnings ESP of +8.97% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Ralph Lauren Corp. (RL - Free Report) has an Earnings ESP of +2.92% and a Zacks Rank #2.
Urban Outfitters Inc. (URBN - Free Report) has an Earnings ESP of +0.62% and a Zacks Rank #2.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>