The Wendy's Company ( WEN Quick Quote WEN - Free Report) is scheduled to report fourth-quarter 2020 results on Mar 3, 2021, before the opening bell. In the last reported quarter, the company delivered an earnings surprise of 11.8%. How Are Estimates Placed?
The Zacks Consensus Estimate for fourth-quarter earnings line is pegged at 18 cents per share, indicating growth of 125% from 8 cents registered in the year-ago quarter.
For revenues, the consensus mark is pegged at $480.6 million, suggesting an increase of 12.5% from the year-ago quarter’s figure. Let's take a look at how things have shaped up in the quarter. Factors at Play
Wendy’s fourth-quarter 2020 results is likely to have benefitted its breakfast business. Notably, launch of new Classic Chicken Sandwich is likely to have driven the fourth-quarter top line. Meanwhile, Wendy’s fourth-quarter margins are likely to be supported by a fall in beef prices. Notably, the company anticipates sequential improvement in margins in the to-be-reported quarter.
Moreover, the company is focused on initiatives like menu innovation, technological upgrades, marketing and promotional activities, international expansion (U.K.) and re-imaging of units. This along with higher average checks and frequency with regards to the Wendy's Rewards program are likely to have positively impacted fourth-quarter results. However, resurgence in COVID-19 cases along with dining restrictions as well as unfavorable weather conditions is likely to have negatively impacted fourth-quarter results. This along with costs related to various sales-boosting initiatives, advertising expenses along with commodity inflation are expected to have affected margins in the to-be-reported quarter. Notably, capital expenditures for the fourth quarter are expected at approximately $70 million. What Our Model Says
Our proven model does not conclusively predict an earnings beat for Wendy’s this time around. A stock needs to have a positive
Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. But that's not the case here. Earnings ESP: Wendy’s has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Zacks Rank: The company has a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here. Peer Releases Yum! Brands, Inc. ( YUM Quick Quote YUM - Free Report) reported strong fourth-quarter 2020 results, with earnings and revenues surpassing the Zacks Consensus Estimate. Both the metrics increased year over year. The company’s adjusted earnings of $1.15 beat the Zacks Consensus Estimate of 99 cents. In the prior-year quarter, the company had reported adjusted earnings of $1.00. Quarterly revenues of $1,743 million surpassed the consensus estimate of $1,731 million. The top line also increased 3% year over year. The upside can be attributed to increase in company sales. McDonald's Corporation ( MCD Quick Quote MCD - Free Report) reported fourth-quarter 2020 results, with earnings and revenues missing the Zacks Consensus Estimate. The company reported adjusted earnings of $1.70 per share, which missed the Zacks Consensus Estimate of $1.75. Moreover, the bottom line declined 14% year over year. Quarterly revenues of $5,313.8 million missed the Zacks Consensus Estimate of $5,320 million. The top line declined 2% year over year. The downtick was caused by the coronavirus pandemic. Starbucks Corporation ( SBUX Quick Quote SBUX - Free Report) reported mixed first-quarter fiscal 2021 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The company reported adjusted earnings per share (EPS) of 61 cents, which beat the Zacks Consensus Estimate of 55 cents. In the prior-year quarter, the company had reported adjusted EPS of 79 cents. Meanwhile, quarterly revenues of $6,749.4 million missed the Zacks Consensus Estimate of $6,873 million. Moreover, the top line fell 4.9% from the year-ago quarter’s levels. The downside was caused by dismal global retail and comparable sales as well as decline in store traffic. Zacks Top 10 Stocks for 2021
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