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Factors Likely to Influence Michaels' (MIK) Q3 Earnings
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The Michaels Companies, Inc. is slated to report third-quarter fiscal 2020 results on Dec 3, before the opening bell.
The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings is pegged at 59 cents, which suggests a sharp improvement of 47.5% from 40 cents reported in the year-ago quarter. Notably, the consensus mark has been unchanged in the past 30 days. The consensus estimate for fiscal third-quarter sales is pegged at $1,419 million, indicating 16.1% growth from the prior-year quarter’s reported number.
The company delivered a positive earnings surprise of 700% in the last reported quarter. Moreover, the bottom line beat estimates by 38.1%, on average, in the trailing four quarters.
Factors to Note
Michaels’ focus on enhancing marketing activities, improving omni-channel and e-commerce capabilities, and providing contactless in-store shopping experience is likely to have favorably impacted fiscal third-quarter performance. We note that the company has been gaining from the rising demand for its products online, which might have boosted e-commerce sales. Its quarterly performance is likely to have benefited from capabilities like buy online, pick up in-store; same-day delivery; and expanded ship from store.
On the store front, the company has been reinventing its store formats with a new in-store layout, inspiration hubs and an innovative checkout design under its Maker strategy. Alongside this, its revamped rewards loyalty program is expected to have had a favorable impact on the fiscal third-quarter performance.
Clearly, the aforementioned factors raise optimism about the results. However, margins remain an area to watch. Impacts of costs associated with digital fulfillment and COVID-related expenses cannot be ruled out. We note that costs related to additional employee payments and benefits, and investments undertaken to preserve the safety and health of customers and team members amid the coronavirus crisis are likely to get reflected in margins.
The Michaels Companies, Inc. Price and EPS Surprise
Our proven model does not conclusively predict an earnings beat for Michaels this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Michaels has a Zacks Rank #2 but an Earnings ESP of 0.00%.
Stocks Poised to Beat Earnings Estimates
Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this time around.
The Kroger Co. (KR - Free Report) presently has an Earnings ESP of +0.38% and a Zacks Rank #2.
Casey’s General Stores (CASY - Free Report) currently has an Earnings ESP of +1.49% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Factors Likely to Influence Michaels' (MIK) Q3 Earnings
The Michaels Companies, Inc. is slated to report third-quarter fiscal 2020 results on Dec 3, before the opening bell.
The Zacks Consensus Estimate for the company’s fiscal third-quarter earnings is pegged at 59 cents, which suggests a sharp improvement of 47.5% from 40 cents reported in the year-ago quarter. Notably, the consensus mark has been unchanged in the past 30 days. The consensus estimate for fiscal third-quarter sales is pegged at $1,419 million, indicating 16.1% growth from the prior-year quarter’s reported number.
The company delivered a positive earnings surprise of 700% in the last reported quarter. Moreover, the bottom line beat estimates by 38.1%, on average, in the trailing four quarters.
Factors to Note
Michaels’ focus on enhancing marketing activities, improving omni-channel and e-commerce capabilities, and providing contactless in-store shopping experience is likely to have favorably impacted fiscal third-quarter performance. We note that the company has been gaining from the rising demand for its products online, which might have boosted e-commerce sales. Its quarterly performance is likely to have benefited from capabilities like buy online, pick up in-store; same-day delivery; and expanded ship from store.
On the store front, the company has been reinventing its store formats with a new in-store layout, inspiration hubs and an innovative checkout design under its Maker strategy. Alongside this, its revamped rewards loyalty program is expected to have had a favorable impact on the fiscal third-quarter performance.
Clearly, the aforementioned factors raise optimism about the results. However, margins remain an area to watch. Impacts of costs associated with digital fulfillment and COVID-related expenses cannot be ruled out. We note that costs related to additional employee payments and benefits, and investments undertaken to preserve the safety and health of customers and team members amid the coronavirus crisis are likely to get reflected in margins.
The Michaels Companies, Inc. Price and EPS Surprise
The Michaels Companies, Inc. price-eps-surprise | The Michaels Companies, Inc. Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Michaels this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Michaels has a Zacks Rank #2 but an Earnings ESP of 0.00%.
Stocks Poised to Beat Earnings Estimates
Here are some companies that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this time around.
Signet Jewelers Limited (SIG - Free Report) currently has an Earnings ESP of +13.95% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Kroger Co. (KR - Free Report) presently has an Earnings ESP of +0.38% and a Zacks Rank #2.
Casey’s General Stores (CASY - Free Report) currently has an Earnings ESP of +1.49% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>