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Buckle (BKE) Q3 Earnings: Stock Likely to Disappoint?

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The Buckle, Inc. (BKE - Free Report) is slated to release third-quarter fiscal 2016 results on Nov 18. The question lingering in investors’ minds is whether this retailer of casual apparel, footwear and accessories will be able to deliver a positive earnings surprise in the quarter to be reported. In the trailing four quarters, the company underperformed the Zacks Consensus Estimate by an average of 3.1%. Let’s see how things are shaping up for this announcement.

BUCKLE INC Price and EPS Surprise

BUCKLE INC Price and EPS Surprise | BUCKLE INC Quote

Zacks Model Shows Unlikely Earnings Beat

Our proven model does not conclusively show that Buckle is likely to beat earnings estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Buckle has an Earnings ESP of 0.00% as the Most Accurate estimate and the Zacks Consensus Estimate both stand at 51 cents. Moreover, the company carries a Zacks Rank #4 (Sell). We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Factors Influencing This Quarter

Buckle has not been able to turn the performance of its struggling Women’s business around. Women's merchandise sales were down about 13% during the second quarter. Men's merchandise sales declined 5% during the quarter. Moreover, a competitive retail landscape and cautious consumer spending have been weighing upon the company’s performance. We observe that Buckle’s net sales decreased 15.1% in October, 14.8% in September and 14% in August. On the other hand, comparable sales also declined 15.5% in both October and September, and 14.8% in August.

Comps for the 13-week period ended Oct 29, 2016, declined 15.3%, while net sales over the period decreased 14.6% to $239.2 million from $280.2 million reported in the year-ago period.

Further, analysts covering the stock are cautious about the upcoming results. This is clearly evident from the downward revision in the Zacks Consensus Estimate for the third quarter in the past 30 days. The Zacks Consensus Estimate declined about 7.3% in the said time frame.

Stocks Poised to Beat Earnings Estimates

Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

Burlington Stores, Inc. (BURL - Free Report) has an Earnings ESP of +6.06% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Dave & Buster's Entertainment, Inc. (PLAY - Free Report) has an Earnings ESP of +15.39% and a Zacks Rank #3.

Express Inc. (EXPR - Free Report) has an Earnings ESP of +16.67% and a Zacks Rank #3.

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