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Ruby Tuesday (RT) Q1 Earnings Preview: What's in Store?

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TN-based casual dining foodservice retailer, Ruby Tuesday, Inc. is scheduled to report its first-quarter fiscal 2017 figures on Oct 6, after market closes.

Let’s see how things are shaping up for this announcement.

Factors Likely to Influence this Quarter

The company recently announced preliminary results for first-quarter fiscal 2017. Ruby Tuesday expects adjusted loss in the range of 10 cents to 12 cents per share. Meanwhile, total revenue, including franchise revenue, is projected to come around $256.7 million. On the other hand, comps are anticipated to be down roughly 2.7% in the to-be-reported quarter.

The company has an Earnings ESP of 0.00% and the Zacks Consensus Estimate for the quarter is pegged at a loss of 11 cents per share. Notably, the company reported a loss of 3 cents per share in the year-ago quarter.

RUBY TUESDAY Price and EPS Surprise


RUBY TUESDAY Price and EPS Surprise | RUBY TUESDAY Quote

In fact, Ruby Tuesday has incurred losses in four out of the last six quarters. Moreover, higher labor costs and other expenses are expected to take a toll on the company’s profits in the quarter as well. Also, traffic may continue to decline due to persistent softness in the casual dining industry and attractive discount offerings by competitors.

Nonetheless, Ruby Tuesday is aggressively pursuing brand transformation initiatives. Menu innovation, limited time offers, streamlining of operations, increased marketing efforts and digital initiatives coupled with re-imaging of restaurants should draw customers and likely boost the quarterly results.

Stocks to Consider

According to our quantitative model, a company needs the right combination of two key factors – a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) – to increase its odds of an earnings surprise.

Here are some companies to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

Wingstop Inc. (WING - Free Report) has an Earnings ESP of +9.09% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Buffalo Wild Wings Inc. has an Earnings ESP of +4.00% and a Zacks Rank #2.

Fastenal Company (FAST - Free Report) has an Earnings ESP of +2.22% and a Zacks Rank #3.

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