Panera Bread Company is scheduled to report second-quarter 2016 numbers on Jul 26, after market close.
Last quarter, Panera posted a 4.00% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in three of the last four quarters, with an average beat of 2.29%.
Let’s see how things are shaping up for this announcement.
Factors Likely to Influence this Quarter
The company’s Panera 2.0 program, menu innovation and promotional strategies have started yielding results, with sales inching up at the converted restaurants. We expect sales to continue to improve in the second quarter.
Meanwhile, Panera’s decision to remove artificial ingredients from At-Home products should enhance its popularity among health-conscious consumers. Also, increased focus on catering should drive revenues in the to-be-reported quarter.
However, the company is incurring heavy costs for implementing the initiatives under Panera 2.0. Also, massive investments along with increased labor expenses might further keep the quarter’s profits under pressure.
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 -1.14%. This is because the Most Accurate estimate stands at $1.73 per share while the Zacks Consensus Estimate is pegged higher at $1.75.
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.
Meanwhile, we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some restaurant companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Papa John's International Inc. (PZZA - Free Report) has an earnings ESP of +3.70% and a Zacks Rank #2.
Jack in the Box Inc. (JACK - Free Report) has an earnings ESP of +1.15% and a Zacks Rank #2.
Shake Shack Inc. (SHAK - Free Report) has an earnings ESP of +7.69% and a Zacks Rank #3.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Panera Bread Company is scheduled to report second-quarter 2016 numbers on Jul 26, after market close.
Last quarter, Panera posted a 4.00% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in three of the last four quarters, with an average beat of 2.29%.
Let’s see how things are shaping up for this announcement.
Factors Likely to Influence this Quarter
The company’s Panera 2.0 program, menu innovation and promotional strategies have started yielding results, with sales inching up at the converted restaurants. We expect sales to continue to improve in the second quarter.
Meanwhile, Panera’s decision to remove artificial ingredients from At-Home products should enhance its popularity among health-conscious consumers. Also, increased focus on catering should drive revenues in the to-be-reported quarter.
However, the company is incurring heavy costs for implementing the initiatives under Panera 2.0. Also, massive investments along with increased labor expenses might further keep the quarter’s profits under pressure.
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 -1.14%. This is because the Most Accurate estimate stands at $1.73 per share while the Zacks Consensus Estimate is pegged higher at $1.75.
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.
Meanwhile, we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some restaurant companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Papa John's International Inc. (PZZA - Free Report) has an earnings ESP of +3.70% and a Zacks Rank #2.
Jack in the Box Inc. (JACK - Free Report) has an earnings ESP of +1.15% and a Zacks Rank #2.
Shake Shack Inc. (SHAK - Free Report) has an earnings ESP of +7.69% and a Zacks Rank #3.
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 >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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