Panera Bread Company is scheduled to report third-quarter 2016 numbers on Oct 25, after market close.
Last quarter, Panera delivered a 1.71% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 3.02%.
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, 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 third quarter.
Meanwhile, Panera’s endeavor to remove all artificial ingredients from its food continues to enhance its popularity among health-conscious consumers. Also, increased focus on catering, sound marketing initiatives and the company’s loyalty program should boost the quarter’s results.
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 -0.74%. This is because the Most Accurate estimate stands at $1.34 per share while the Zacks Consensus Estimate is pegged higher at $1.35.
Zacks Rank: Panera has a Zacks Rank #4 (Sell). 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 restaurant companies to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
The Wendy's Company (WEN - Free Report) has an Earnings ESP of +10.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Fogo de Chao, Inc. has an Earnings ESP of +13.33% and a Zacks Rank #3.
Dave & Buster's Entertainment, Inc. (PLAY - Free Report) has an Earnings ESP of +7.69% and a Zacks Rank #3.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
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 >>
Panera Bread Company is scheduled to report third-quarter 2016 numbers on Oct 25, after market close.
Last quarter, Panera delivered a 1.71% positive earnings surprise. In fact, the company’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, with an average beat of 3.02%.
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, 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 third quarter.
Meanwhile, Panera’s endeavor to remove all artificial ingredients from its food continues to enhance its popularity among health-conscious consumers. Also, increased focus on catering, sound marketing initiatives and the company’s loyalty program should boost the quarter’s results.
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 -0.74%. This is because the Most Accurate estimate stands at $1.34 per share while the Zacks Consensus Estimate is pegged higher at $1.35.
Zacks Rank: Panera has a Zacks Rank #4 (Sell). 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 restaurant companies to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:
The Wendy's Company (WEN - Free Report) has an Earnings ESP of +10.00% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Fogo de Chao, Inc. has an Earnings ESP of +13.33% and a Zacks Rank #3.
Dave & Buster's Entertainment, Inc. (PLAY - Free Report) has an Earnings ESP of +7.69% and a Zacks Rank #3.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
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 >>
Get the latest research report on WEN - FREE
Get the latest research report on PLAY - FREE