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What to Note Ahead of Bath & Body Works' (BBWI) Q2 Earnings
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Bath & Body Works, Inc. (BBWI - Free Report) is likely to register a top- and bottom-line decline when it posts second-quarter 2023 earnings on Aug 23. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.6 billion, indicating a decline of 3% from the year-ago quarter’s actuals.
The consensus mark for second-quarter earnings has been stable at 32 cents in the past 30 days, suggesting a decrease of 38.5% from the year-ago quarter’s figure.
The company has a trailing four-quarter earnings surprise of 44.6%, on average. BBWI delivered an earnings surprise of 26.9% in the last reported quarter.
Bath & Body Works is expected to have benefited from strong demand for fragrances, new product launches, including Gingham and a robust distribution network. For instance, the company has been witnessing a surge in demand for Gingham products, which has led BBWI to increase its supply. However, lower transactions and a decrease in average dollar sales are expected to have hurt its top line in the second quarter. The company projects net sales to decline in low??? to mid???single digits for the second quarter.
The company remains committed to increasing its off-mall penetration, as evident by the opening of 16 new off-mall North American stores in the first quarter. It also opened nine new stores in its international business in the quarter, which is likely to have reflected in the second quarter results.
However, over time, escalating costs and operating expenses have been a concern for Bath & Body Works. BBWI’s cost of sales and general, administrative and store operating expenses increased by 2.4% and 6.7% year over year, respectively, in the first quarter of 2023. Though pricing actions are expected to have been a relief, higher prices of raw materials and logistics, along with the ongoing headwinds from growth investments, might have adversely impacted its performance. BBWI estimates net non-operating expenses of $75 million in the to-be-reported quarter.
For the second quarter, Bath & Body Works expects its gross margin to be roughly 39%, reflecting a year-over-year decline from 40.8%. The decrease is primarily attributable to the expected sales decline and increased occupancy expenses from new store growth. It anticipates adjusted earnings per share in the band of 27-32 cents compared with 52 cents per share reported in the year-ago quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Bath & Body Works 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.
Bath & Body Works carries a Zacks Rank #2 and 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.
Stocks With the Favorable Combination
Here are some companies that, according to our model, have the right combination of elements to post an earnings beat in the to-be-reported quarter.
The company is likely to register top- and bottom-line growth when it reports its second-quarter fiscal 2023 results. The consensus mark for TJX’s quarterly revenues is pegged at $12.4 billion, suggesting growth of 5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for TJX’s earnings has been unchanged at 76 cents per share in the past 30 days. The consensus estimate indicates 10.1% growth from the year-ago quarter’s reported figure.
Urban Outfitters (URBN - Free Report) currently has an Earnings ESP of +2.30% and a Zacks Rank #2. The company is likely to register growth in the top and bottom lines when it reports its second-quarter fiscal 2023 numbers. The consensus mark for URBN’s quarterly earnings has moved up by a penny to 88 cents per share in the past seven days. The consensus estimate suggests 39.1% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for Urban Outfitters’ quarterly revenues is pegged at $1.25 billion, suggesting an increase of 5.4% from the figure reported in the prior-year quarter.
Tapestry (TPR - Free Report) currently has an Earnings ESP of +1.71% and a Zacks Rank #3. The company is likely to register growth in the top and bottom lines when it reports its second-quarter 2023 results. The consensus mark for TPR’s quarterly revenues is pegged at $1.7 billion, which suggests 2.6% growth from the figure reported in the prior-year quarter.
The consensus mark for TPR’s quarterly earnings has moved up by a penny in the past seven days to 96 cents per share. The consensus estimate suggests an increase of 23.1% from the year-ago quarter.
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What to Note Ahead of Bath & Body Works' (BBWI) Q2 Earnings
Bath & Body Works, Inc. (BBWI - Free Report) is likely to register a top- and bottom-line decline when it posts second-quarter 2023 earnings on Aug 23. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.6 billion, indicating a decline of 3% from the year-ago quarter’s actuals.
The consensus mark for second-quarter earnings has been stable at 32 cents in the past 30 days, suggesting a decrease of 38.5% from the year-ago quarter’s figure.
The company has a trailing four-quarter earnings surprise of 44.6%, on average. BBWI delivered an earnings surprise of 26.9% in the last reported quarter.
Bath & Body Works, Inc. Price and EPS Surprise
Bath & Body Works, Inc. price-eps-surprise | Bath & Body Works, Inc. Quote
Factors To Note
Bath & Body Works is expected to have benefited from strong demand for fragrances, new product launches, including Gingham and a robust distribution network. For instance, the company has been witnessing a surge in demand for Gingham products, which has led BBWI to increase its supply. However, lower transactions and a decrease in average dollar sales are expected to have hurt its top line in the second quarter. The company projects net sales to decline in low??? to mid???single digits for the second quarter.
The company remains committed to increasing its off-mall penetration, as evident by the opening of 16 new off-mall North American stores in the first quarter. It also opened nine new stores in its international business in the quarter, which is likely to have reflected in the second quarter results.
However, over time, escalating costs and operating expenses have been a concern for Bath & Body Works. BBWI’s cost of sales and general, administrative and store operating expenses increased by 2.4% and 6.7% year over year, respectively, in the first quarter of 2023. Though pricing actions are expected to have been a relief, higher prices of raw materials and logistics, along with the ongoing headwinds from growth investments, might have adversely impacted its performance. BBWI estimates net non-operating expenses of $75 million in the to-be-reported quarter.
For the second quarter, Bath & Body Works expects its gross margin to be roughly 39%, reflecting a year-over-year decline from 40.8%. The decrease is primarily attributable to the expected sales decline and increased occupancy expenses from new store growth. It anticipates adjusted earnings per share in the band of 27-32 cents compared with 52 cents per share reported in the year-ago quarter.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Bath & Body Works 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.
Bath & Body Works carries a Zacks Rank #2 and 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.
Stocks With the Favorable Combination
Here are some companies that, according to our model, have the right combination of elements to post an earnings beat in the to-be-reported quarter.
The TJX Companies (TJX - Free Report) currently has an Earnings ESP of +2.36% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is likely to register top- and bottom-line growth when it reports its second-quarter fiscal 2023 results. The consensus mark for TJX’s quarterly revenues is pegged at $12.4 billion, suggesting growth of 5% from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for TJX’s earnings has been unchanged at 76 cents per share in the past 30 days. The consensus estimate indicates 10.1% growth from the year-ago quarter’s reported figure.
Urban Outfitters (URBN - Free Report) currently has an Earnings ESP of +2.30% and a Zacks Rank #2. The company is likely to register growth in the top and bottom lines when it reports its second-quarter fiscal 2023 numbers. The consensus mark for URBN’s quarterly earnings has moved up by a penny to 88 cents per share in the past seven days. The consensus estimate suggests 39.1% growth from the year-ago quarter’s reported number.
The Zacks Consensus Estimate for Urban Outfitters’ quarterly revenues is pegged at $1.25 billion, suggesting an increase of 5.4% from the figure reported in the prior-year quarter.
Tapestry (TPR - Free Report) currently has an Earnings ESP of +1.71% and a Zacks Rank #3. The company is likely to register growth in the top and bottom lines when it
reports its second-quarter 2023 results. The consensus mark for TPR’s quarterly revenues is pegged at $1.7 billion, which suggests 2.6% growth from the figure reported in the prior-year quarter.
The consensus mark for TPR’s quarterly earnings has moved up by a penny in the past seven days to 96 cents per share. The consensus estimate suggests an increase of 23.1% from the year-ago quarter.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.