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What's in the Cards for Azul (AZUL) This Earnings Season?
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Azul S.A.(AZUL - Free Report) is slated to report first-quarter 2021 financial numbers on May 6, before market open.
Azul has a very disappointing earnings record. The carrier’s bottom line underperformed the Zacks Consensus Estimate in all of the last four quarters. It has a trailing four-quarter negative earnings surprise of 129.1%, on average.
Moreover, the Zacks Consensus Estimate for the to-be-reported quarter’s bottom line is currently pegged at a loss of $1.64, which suggests deterioration from a loss of $1.16 per share 60 days ago.
Against this backdrop, let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.
With Brazil reeling under a second wave of the deadly coronavirus pandemic, passenger revenues, which account for the bulk of the company’s top line, are likely to have been soft in the quarter to be reported. This is likely to have hurt the top line. Due to tepid demand, load factor (% of seats filled by passengers) is expected to have declined on a year-over-year basis.
Depreciation of the Brazilian currency might have negatively impacted the company’s first-quarter performance.
However, strong e-commerce growth leading to rise in cargo revenues is likely to have driven Azul’s top-line numbers.
What Does the Zacks Model Say?
Our proven model does not predict a bottom-line outperformance for Azul 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 a positive surprise. But that is not the case here as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Azul has an Earnings ESP of 17.68%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Azul carries a Zacks Rank #4 (Sell), currently.
Highlights of Q4
Azul incurred a loss (adjusted) of $1.49 per share in the fourth quarter of 2020, wider than the Zacks Consensus Estimate of a loss of 80 cents. In the year-ago period, the company reported adjusted earnings of 95 cents per share. While air-travel demand is gradually recovering from the coronavirus-led lows, it is still significantly below 2019 levels. This was reflected in fourth-quarter results.
Stocks to Consider
Investors interested in the broader Transportation sector may consider International Seaways, Inc. (INSW - Free Report) , GasLog Ltd. and Genco Shipping & Trading Limited (GNK - Free Report) as these stocks possess the right combination of elements to beat estimates this reporting cycle.
International Seaways has an Earnings ESP of +6.98% and a Zacks Rank of 3, currently. The company is set to release first-quarter 2021 earnings numbers on May 6.
GasLog has an Earnings ESP of +20.69% and a Zacks Rank of 2 at present. The company will release first-quarter 2021 results on May 6.
Genco Shipping & Trading has an Earnings ESP of +200.00% and is Zacks #1 Ranked, presently. The company will release first-quarter 2021 results on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Image: Bigstock
What's in the Cards for Azul (AZUL) This Earnings Season?
Azul S.A.(AZUL - Free Report) is slated to report first-quarter 2021 financial numbers on May 6, before market open.
Azul has a very disappointing earnings record. The carrier’s bottom line underperformed the Zacks Consensus Estimate in all of the last four quarters. It has a trailing four-quarter negative earnings surprise of 129.1%, on average.
Moreover, the Zacks Consensus Estimate for the to-be-reported quarter’s bottom line is currently pegged at a loss of $1.64, which suggests deterioration from a loss of $1.16 per share 60 days ago.
Against this backdrop, let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.
AZUL SA Price and EPS Surprise
AZUL SA price-eps-surprise | AZUL SA Quote
With Brazil reeling under a second wave of the deadly coronavirus pandemic, passenger revenues, which account for the bulk of the company’s top line, are likely to have been soft in the quarter to be reported. This is likely to have hurt the top line. Due to tepid demand, load factor (% of seats filled by passengers) is expected to have declined on a year-over-year basis.
Depreciation of the Brazilian currency might have negatively impacted the company’s first-quarter performance.
However, strong e-commerce growth leading to rise in cargo revenues is likely to have driven Azul’s top-line numbers.
What Does the Zacks Model Say?
Our proven model does not predict a bottom-line outperformance for Azul 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 a positive surprise. But that is not the case here as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Azul has an Earnings ESP of 17.68%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Azul carries a Zacks Rank #4 (Sell), currently.
Highlights of Q4
Azul incurred a loss (adjusted) of $1.49 per share in the fourth quarter of 2020, wider than the Zacks Consensus Estimate of a loss of 80 cents. In the year-ago period, the company reported adjusted earnings of 95 cents per share. While air-travel demand is gradually recovering from the coronavirus-led lows, it is still significantly below 2019 levels. This was reflected in fourth-quarter results.
Stocks to Consider
Investors interested in the broader Transportation sector may consider International Seaways, Inc. (INSW - Free Report) , GasLog Ltd. and Genco Shipping & Trading Limited (GNK - Free Report) as these stocks possess the right combination of elements to beat estimates this reporting cycle.
International Seaways has an Earnings ESP of +6.98% and a Zacks Rank of 3, currently. The company is set to release first-quarter 2021 earnings numbers on May 6.
GasLog has an Earnings ESP of +20.69% and a Zacks Rank of 2 at present. The company will release first-quarter 2021 results on May 6.
Genco Shipping & Trading has an Earnings ESP of +200.00% and is Zacks #1 Ranked, presently. The company will release first-quarter 2021 results on May 6.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>