For Immediate Release
Chicago, IL – November 10, 2016 – Zacks Equity Research highlights definitely Cloud Peak Energy (CLD - Free Report) – Free Report) as the Bull of the Day and Buckle (BKE - Free Report) – Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on Blue Buffalo Pet Products Inc. (NASDAQ:(BUFF - Free Report) –Free Report),Edgewell Personnel Care Company (NYSE:(EPC - Free Report) –Free Report) and e.l.f. Beauty, Inc. (NYSE:(ELF - Free Report) – Free Report).
Here is a synopsis of all five stocks:
Bull of the Day:
Finally this hard fought election has come to an end. With it, the Hillary trade is over. So that means that stocks that took a punch heading into November have a good chance of rebounding. That’s why you saw a sharp rally in stocks in industries like raw materials and construction. But the pro-Trump trade now is being especially beneficial to coal companies like today’s Bull of the Day.
Cloud Peak Energy (CLD - Free Report) – Free Report) produces coal in the Powder River Basin in the United States. The company operates through Owned and Operated Mines, and Logistics and Related Activities. It owns and operates three surface coal mines comprising the Antelope Mine and the Cordero Rojo Mine located in Wyoming, and the Spring Creek Mine located in Montana. These mines produce subbituminous thermal coal with low sulfur content. The company sells its coal primarily to domestic and foreign electric utilities. As of December 31, 2015, it controlled approximately 1.1 billion tons of proven and probable reserves.
The stock was a Zacks Rank #1 (Strong Buy) heading into the election and should catch even more positive news following Trump’s victory. A big reason for the Zacks Rank is three analysts have increased their earnings estimates for next year. The bullish sentiment has push up our Zacks Consensus Estimate from a 74 cent loss to a 6 cent gain. That’s a huge swing in a very short amount of time.
That bullish sentiment has been met with a huge rally in the stock. Taking a quick look at the stock chart, you can see that shares have gone from $2 in July to nearly $8 during yesterday’s trading session. All the while, shares have consistently remained above the 50-day moving average. The last “Buy” signal coming from the Commodity Channel Index occurred in late October with the CCI crossing up through the zero line after being well oversold below -100. The large gap in yesterday’s trading does run the risk of getting filled should profit-takers enter the equation in the short term.
Bear of the Day :
In the past I’ve talked a lot about the death of the American mall. There are a variety of factors contributing to its demise. The most obvious is the rise of online shopping. Online you can get exactly what you want shipped to your home, ordering from the comfort of your couch. The mall, once a centerpiece of the community, is slowly but surely losing its appeal. Retailers have struggled to find that balance between those traditional brick and mortar outlets and an online presence. One such retailer that has been having a tough time adjusting is today’s Bear of the Day, Buckle (BKE - Free Report) – Free Report).
The Buckle, Inc. operates as a retailer of casual apparel, footwear, and accessories for young men and women in the United States. The company markets a selection of brand name casual apparel, including denims, other casual bottoms, tops, sportswear, outerwear, accessories, and footwear. It operates stores under the Buckle and The Buckle names. The company also sells its products through its Website,buckle.com . As of August 19, 2016, it operated 470 retail stores in 44 states.
The stock is a Zacks Rank #5 (Strong Sell) right now. Mostly because three analysts have dropped their earnings estimates for the current quarter, next quarter, current year and next year. The bearish sentiment not only shows lowered estimates but also no growth year over year. Looking at the current year numbers, the consensus has dropped from $2.49 to $2.23. Next year’s number has gone from $2.43 to $2.20.
It should therefore come as no surprise that shares have come under pressure recently. In fact, shares have struggled to break a bearish trend since topping out over $35 last April. Since then, it’s been a stairway to the basement, with BKE dipping to $20 before yesterday’s broad-based rally that boosted most of the market. There is one silver lining here, the Commodity Channel Index has popped up through the zero line, giving a “Buy” signal after being oversold below -100 for the last couple of weeks.
Consumer Stocks Earnings to Watch for Thursday: BUFF, EPC, ELF
The Q3 earnings season is nearing its end with results already out for 423 S&P 500 members. The results announced so far display significant improvement from the preceding quarters. The quarter reported notable growth after five quarters of back-to-back decline. According to the latest Earnings Preview, of the 84.6% S&P 500 members that have reported Q3 results so far, 72.8% have posted positive earnings surprises and 55.1% have come ahead of top-line expectations.
The Consumer sector comprising consumer staples and consumer discretionary sector is showing positive signs this quarter. While total earnings for consumer staples are expected to grow 6.5%, that for consumer discretionary are expected to go up 6.2%. As of Nov 4, 78.1% of the total number of S&P 500 companies in the consumer staples sector that have reported their results, 76% beat earnings and 36% of the companies surpassed revenue estimates.
In the consumer discretionary sector, 74.3% of the total number of S&P 500 companies that have reported their results, 73.1% beat earnings and 50% of companies’ surpassed revenue estimates. Efficient pricing, solid cost reduction initiatives, lucrative acquisitions and efforts to enhance product portfolio cushion these companies from macroeconomic hurdles, consequently driving their bottom lines.
Consumer stocks are particularly doing well in the third quarter. Leading firms from the industry have delivered better-than-expected Q3 earnings results despite currency headwinds and the sluggishness in emerging markets.
Let’s take a look at what’s in store for three consumer stocks which are scheduled to release their quarterly numbers on Nov 10.
We start with Blue Buffalo Pet Products Inc. (NASDAQ:(BUFF - Free Report) – Free Report) which is scheduled to report third-quarter 2016 results after the closing bell. The company has an Earnings ESP of 0.00% and carries a Zacks Rank #2 (Buy). Meanwhile, the Zacks Consensus Estimate for third-quarter earnings is pegged at 20 cents. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
However, we need to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 or #3 (Hold) to be confident about a positive surprise. So, though a Zacks Rank #2 increases the predictive power, an Earnings ESP of 0.00% makes surprise prediction difficult. You can see the complete list of today’s Zacks #1 Rank stocks here .
BLUE BUFFALO Price and EPS Surprise | BLUE BUFFALO Quote
Additionally, the company posted positive surprises in all the trailing four quarters with an average positive surprise of 13.26%.
Edgewell Personnel Care Company (NYSE:(EPC - Free Report) – Free Report) is slated to report fourth-quarter 2016 numbers before the market opens. The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 96 cents. Additionally, the company posted positive surprises in all the trailing four quarters with an average negative surprise of 4.54%.
EDGEWELL PERSNL Price and EPS Surprise | EDGEWELL PERSNL Quote
We are not sure about an earnings beat for this stock during the quarter as it has an unfavorable combination of an Earnings ESP of 0.00% and carries a Zacks Rank #3.
Lastly we consider e.l.f. Beauty, Inc. (NYSE:(ELF - Free Report) – Free Report) which is slated to report third-quarter 2016 numbers after market close. The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 1 cent.
E.L.F. BEAUTY Price and EPS Surprise | E.L.F. BEAUTY Quote
We are not sure about an earnings beat for this stock during the quarter as it has an unfavorable combination of an Earnings ESP of 0.00% and a Zacks Rank #3.
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About the Bull and Bear of the Day
Every day, the analysts at Zacks Equity Research select two stocks that are likely to outperform (Bull) or underperform (Bear) the markets over the next 3-6 months.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous analyst coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
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