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Walmart, Target, Home Depot, TJX Companies and Macy???s are part of Zacks Earnings Preview
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For Immediate Release
Chicago, IL – May 18,2020 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Walmart (WMT - Free Report) , Target (TGT - Free Report) , Home Depot (HD - Free Report) , TJX Companies (TJX - Free Report) and Macy’s (M - Free Report) .
Previewing Retail's First Coronavirus Earnings Season
The Q1 earnings season has effectively come to an end for most of the major sectors, with the Retail sector as the only one that has a significant number of reports still to come. We will start getting those results this week, with a number of major players like Walmart, Target, Home Depot and others on deck to report results.
The Retail space has been hit hard by the pandemic-related lockdowns, as Friday’s April Retail Sales report more than showed. But the three big-box operators mentioned here don’t belong on the ‘victims’ list; they have thrived during this downturn and will likely continue to do so in the days.
A number of others like TJX Companies and others that are reporting this week are going through a very painful phase in their lives. Macy’s, which would normally be reporting this week as well, has put off its quarterly release for now but will instead share some preliminary results this week.
We typically associate the traditional brick-and-mortar operators as the only ones belonging in the retail space, with the traditional industry/sector classification systems putting those companies either in the Consumer Discretionary sector or in the Consumer Staples sectors. In that system, online vendors get placed in the Technology sector. But we have a stand-alone Retail sector that not only includes the traditional players but also online vendors and restaurant operators.
For the Zacks Retail sector, one of the 16 Zacks sectors, we have already seen Q1 results from 17 of the 36 companies in the S&P 500 index. Most of the Retail sector results that have come out already are from online operators and restaurant players, with the traditional brick-and-mortar players starting to report this week.
Total earnings for these Retail sector companies that have reported already are down -15.1% from the same period last year on +11.2% higher revenues, with 70.6% beating EPS estimates and 88.2% beating revenue estimates.
An above-average proportion of retailers have been able to beat estimates thus far. But that’s primarily a function of the type of retailers that have reported already. It is reasonable to think that the beats percentages will not be as favorable for the traditional retailers. With respect to the sector’s Q1 earnings and revenue growth pace, the picture changes meaningfully once Amazon’s results are removed from the sector’s aggregated reported numbers.
For Q1 as a whole for the sector, combining the results that have come out with estimates for the still-to-come companies, total earnings are expected to be down -21% from the same period last year on +5.3% higher revenues. This would follow +1% growth on +7.2% higher revenues in 2019 Q4.
Q1 Earnings Season Scorecard
As of Friday, May 15th, we have seen Q1 results from 451 S&P 500 members or 90.2% of the index’s total membership. Total earnings or aggregate net income for these 451 index members that have reported already are down -11.1% from the same period last year on +1.3% higher revenues, with 67.2% beating EPS and 57.6% beating revenue estimates.
We have another 23 S&P 500 members on deck to report results this week.
As we have been pointing over the last few weeks, Q1 results show the opposing effects that the two largest sectors in the S&P 500 index are having on the aggregate growth picture. These two largest sectors are Finance and Technology, with Finance dragging it down and Technology pushing it higher.
Had it not been for the Finance sector drag, Q1 earnings growth for the remaining S&P 500 companies at this stage would have been a lot better, thanks primarily to the Technology sector results.
Excluding the Finance sector, whose Q1 earnings are down -33.1% on +2.4% higher revenues, earnings for the rest of S&P 500 companies that have reported would be down only -3.7% (vs. down -11.1% with Finance).
Excluding the Technology sector results, whose Q1 earnings are up +5.8% on +4.9% higher revenues, earnings for the rest of S&P 500 companies that have reported would be down -15.9% (vs. down -11.1% with Technology).
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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Walmart, Target, Home Depot, TJX Companies and Macy???s are part of Zacks Earnings Preview
For Immediate Release
Chicago, IL – May 18,2020 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Walmart (WMT - Free Report) , Target (TGT - Free Report) , Home Depot (HD - Free Report) , TJX Companies (TJX - Free Report) and Macy’s (M - Free Report) .
Previewing Retail's First Coronavirus Earnings Season
The Q1 earnings season has effectively come to an end for most of the major sectors, with the Retail sector as the only one that has a significant number of reports still to come. We will start getting those results this week, with a number of major players like Walmart, Target, Home Depot and others on deck to report results.
The Retail space has been hit hard by the pandemic-related lockdowns, as Friday’s April Retail Sales report more than showed. But the three big-box operators mentioned here don’t belong on the ‘victims’ list; they have thrived during this downturn and will likely continue to do so in the days.
A number of others like TJX Companies and others that are reporting this week are going through a very painful phase in their lives. Macy’s, which would normally be reporting this week as well, has put off its quarterly release for now but will instead share some preliminary results this week.
We typically associate the traditional brick-and-mortar operators as the only ones belonging in the retail space, with the traditional industry/sector classification systems putting those companies either in the Consumer Discretionary sector or in the Consumer Staples sectors. In that system, online vendors get placed in the Technology sector. But we have a stand-alone Retail sector that not only includes the traditional players but also online vendors and restaurant operators.
For the Zacks Retail sector, one of the 16 Zacks sectors, we have already seen Q1 results from 17 of the 36 companies in the S&P 500 index. Most of the Retail sector results that have come out already are from online operators and restaurant players, with the traditional brick-and-mortar players starting to report this week.
Total earnings for these Retail sector companies that have reported already are down -15.1% from the same period last year on +11.2% higher revenues, with 70.6% beating EPS estimates and 88.2% beating revenue estimates.
An above-average proportion of retailers have been able to beat estimates thus far. But that’s primarily a function of the type of retailers that have reported already. It is reasonable to think that the beats percentages will not be as favorable for the traditional retailers. With respect to the sector’s Q1 earnings and revenue growth pace, the picture changes meaningfully once Amazon’s results are removed from the sector’s aggregated reported numbers.
For Q1 as a whole for the sector, combining the results that have come out with estimates for the still-to-come companies, total earnings are expected to be down -21% from the same period last year on +5.3% higher revenues. This would follow +1% growth on +7.2% higher revenues in 2019 Q4.
Q1 Earnings Season Scorecard
As of Friday, May 15th, we have seen Q1 results from 451 S&P 500 members or 90.2% of the index’s total membership. Total earnings or aggregate net income for these 451 index members that have reported already are down -11.1% from the same period last year on +1.3% higher revenues, with 67.2% beating EPS and 57.6% beating revenue estimates.
We have another 23 S&P 500 members on deck to report results this week.
As we have been pointing over the last few weeks, Q1 results show the opposing effects that the two largest sectors in the S&P 500 index are having on the aggregate growth picture. These two largest sectors are Finance and Technology, with Finance dragging it down and Technology pushing it higher.
Had it not been for the Finance sector drag, Q1 earnings growth for the remaining S&P 500 companies at this stage would have been a lot better, thanks primarily to the Technology sector results.
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.