We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Factors to Note Ahead of Capri Holdings' (CPRI) Q1 Earnings
Read MoreHide Full Article
Capri Holdings Limited (CPRI - Free Report) is likely to register a year-over-year decline in its top and bottom lines when it releases first-quarter fiscal 2024 earnings on Aug 8 before market open.
The Zacks Consensus Estimate for revenues is pegged at $1,200 million, indicating a fall of 11.8% from the prior-year reported figure.
The bottom line of the global fashion luxury group is anticipated to decrease year over year. The Zacks Consensus Estimate for fiscal first-quarter earnings per share has declined 1.4% over the past 30 days to 69 cents. The figure suggests a fall of 54% from the year-ago period’s reported number.
Capri Holdings has a trailing four-quarter earnings surprise of 3.5%, on average. In the last reported quarter, this London-based company beat the Zacks Consensus Estimate by a margin of 3.2%.
Capri Holdings has been witnessing sluggish demand for its products, particularly in the Americas, for a while now. Softness across both retail and wholesale businesses, owing to tepid consumer spending across all brands, is expected to have adversely impacted the company’s performance in the fiscal first quarter. Management anticipates revenues from the Americas region to fall year-over-year and foresees a decline of approximately 30% in the wholesale channel.
On its last reported quarter’s earnings call, management anticipated first-quarter fiscal 2024 revenues of $245 million from Versace and $775 million from Michael Kors, indicating year-over-year declines of 11% and 15%, respectively, on a reported basis. However, Jimmy Choo’s revenues are anticipated to be $180 million, indicating an increase of 5% year-over-year.
Rising costs and operating expenses have been a concern for the company over the past few quarters. For instance, in fiscal 2023, its total operating expenses increased 7.2% year over year. Our model indicates a 7.9% increase in operating expenses year over year in the fiscal first quarter.
For the fiscal first quarter, the company expects an adjusted operating margin of 8.5%, in line with our estimate. The figure reflects a decline from 18.5% reported in the year-ago period. The decline primarily reflects the significant deleverage on lower wholesale revenues, apart from higher investments in marketing.
The company projected an operating margin at a break-even level for Versace and in the mid-teens range for Michael Kors and for Jimmy Choo, it expected an operating margin in the high-single-digit range. This might get reflected in the to-be-reported quarter’s bottom line. As a result, management guided first-quarter earnings of approximately 70 cents per share, down from $1.50 reported in the prior-year quarter.
Given its extensive presence across international markets, a stronger U.S. dollar might have hurt its overseas business in the to-be-reported quarter.
However, Capri Holdings is likely to have benefited from improvements in demand in Asia and the EMEA regions. The company’s focus on operational execution and effective pricing actions are expected to have a positive impact on its performance.
CPRI’s retail and e-commerce businesses have been witnessing a sturdy performance, thanks to its outlet stores and the increasing popularity of online shopping. It has been investing in digital analytics and upgrading its e-commerce platform. E-commerce sales witnessed significant growth over the past few quarters, a trend likely to have continued in the fiscal first quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Capri Holdings 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, as elaborated below.
Capri Holdings has an Earnings ESP of -1.86%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
CPRI currently has a Zacks Rank #4 (Sell).
Stocks With the Favorable Combination
Here are three companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming release:
TJX Companies, Inc. (TJX - Free Report) currently has an Earnings ESP of +0.40%. The company is likely to register top- and bottom-line increases when it reports its upcoming quarter results. The consensus mark for TJX’s quarterly revenues is pegged at $12.4 billion, which suggests growth of 4.7% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for TJX’s earnings has been stable at 76 cents per share in the past 30 days.
Stitch Fix, Inc. (SFIX - Free Report) currently has an Earnings ESP of +1.32% and a Zacks Rank #2. The company is likely to register a decline in the top line and growth in the bottom line when it reports its upcoming quarter’s numbers. The consensus mark for its bottom line has moved down by a penny in the past 30 days.
The Zacks Consensus Estimate for SFIX's quarterly revenues is pegged at $371.5 million, which suggests a decline of 22.9% from the figure reported in the prior-year quarter.
Casey's General Stores, Inc. (CASY - Free Report) currently has an Earnings ESP of +1.03% and a Zacks Rank #2. The company is likely to register top- and bottom-line declines when it reports its upcoming quarterly results. The consensus mark for CASY’s quarterly revenues is pegged at $3.9 billion, which suggests a 13.5% fall from the figure reported in the prior-year quarter.
The consensus mark for CASY’s quarterly earnings has declined 3.4% in the past 30 days to $3.39 per share. The consensus estimate suggests a decline of 17.1% from the year-ago quarter.
Image: Bigstock
Factors to Note Ahead of Capri Holdings' (CPRI) Q1 Earnings
Capri Holdings Limited (CPRI - Free Report) is likely to register a year-over-year decline in its top and bottom lines when it releases first-quarter fiscal 2024 earnings on Aug 8 before market open.
The Zacks Consensus Estimate for revenues is pegged at $1,200 million, indicating a fall of 11.8% from the prior-year reported figure.
The bottom line of the global fashion luxury group is anticipated to decrease year over year. The Zacks Consensus Estimate for fiscal first-quarter earnings per share has declined 1.4% over the past 30 days to 69 cents. The figure suggests a fall of 54% from the year-ago period’s reported number.
Capri Holdings has a trailing four-quarter earnings surprise of 3.5%, on average. In the last reported quarter, this London-based company beat the Zacks Consensus Estimate by a margin of 3.2%.
Capri Holdings Limited Price and EPS Surprise
Capri Holdings Limited price-eps-surprise | Capri Holdings Limited Quote
Factors to Note
Capri Holdings has been witnessing sluggish demand for its products, particularly in the Americas, for a while now. Softness across both retail and wholesale businesses, owing to tepid consumer spending across all brands, is expected to have adversely impacted the company’s performance in the fiscal first quarter. Management anticipates revenues from the Americas region to fall year-over-year and foresees a decline of approximately 30% in the wholesale channel.
On its last reported quarter’s earnings call, management anticipated first-quarter fiscal 2024 revenues of $245 million from Versace and $775 million from Michael Kors, indicating year-over-year declines of 11% and 15%, respectively, on a reported basis. However, Jimmy Choo’s revenues are anticipated to be $180 million, indicating an increase of 5% year-over-year.
Rising costs and operating expenses have been a concern for the company over the past few quarters. For instance, in fiscal 2023, its total operating expenses increased 7.2% year over year. Our model indicates a 7.9% increase in operating expenses year over year in the fiscal first quarter.
For the fiscal first quarter, the company expects an adjusted operating margin of 8.5%, in line with our estimate. The figure reflects a decline from 18.5% reported in the year-ago period. The decline primarily reflects the significant deleverage on lower wholesale revenues, apart from higher investments in marketing.
The company projected an operating margin at a break-even level for Versace and in the mid-teens range for Michael Kors and for Jimmy Choo, it expected an operating margin in the high-single-digit range. This might get reflected in the to-be-reported quarter’s bottom line. As a result, management guided first-quarter earnings of approximately 70 cents per share, down from $1.50 reported in the prior-year quarter.
Given its extensive presence across international markets, a stronger U.S. dollar might have hurt its overseas business in the to-be-reported quarter.
However, Capri Holdings is likely to have benefited from improvements in demand in Asia and the EMEA regions. The company’s focus on operational execution and effective pricing actions are expected to have a positive impact on its performance.
CPRI’s retail and e-commerce businesses have been witnessing a sturdy performance, thanks to its outlet stores and the increasing popularity of online shopping. It has been investing in digital analytics and upgrading its e-commerce platform. E-commerce sales witnessed significant growth over the past few quarters, a trend likely to have continued in the fiscal first quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Capri Holdings 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, as elaborated below.
Capri Holdings has an Earnings ESP of -1.86%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
CPRI currently has a Zacks Rank #4 (Sell).
Stocks With the Favorable Combination
Here are three companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat in the upcoming release:
TJX Companies, Inc. (TJX - Free Report) currently has an Earnings ESP of +0.40%. The company is likely to register top- and bottom-line increases when it reports its upcoming quarter results. The consensus mark for TJX’s quarterly revenues is pegged at $12.4 billion, which suggests growth of 4.7% from the figure reported in the prior-year quarter.
TJX currently has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for TJX’s earnings has been stable at 76 cents per share in the past 30 days.
Stitch Fix, Inc. (SFIX - Free Report) currently has an Earnings ESP of +1.32% and a Zacks Rank #2. The company is likely to register a decline in the top line and growth in the bottom line when it reports its upcoming quarter’s numbers. The consensus mark for its bottom line has moved down by a penny in the past 30 days.
The Zacks Consensus Estimate for SFIX's quarterly revenues is pegged at $371.5 million, which suggests a decline of 22.9% from the figure reported in the prior-year quarter.
Casey's General Stores, Inc. (CASY - Free Report) currently has an Earnings ESP of +1.03% and a Zacks Rank #2. The company is likely to register top- and bottom-line declines when it reports its upcoming quarterly results. The consensus mark for CASY’s quarterly revenues is pegged at $3.9 billion, which suggests a 13.5% fall from the figure reported in the prior-year quarter.
The consensus mark for CASY’s quarterly earnings has declined 3.4% in the past 30 days to $3.39 per share. The consensus estimate suggests a decline of 17.1% from the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.