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Adidas (ADDYY) Q1 Earnings: Stock Likely to Beat Estimates?
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We expect sporting goods bigwig, Adidas AG (ADDYY - Free Report) to beat expectations when it reports first-quarter 2017 results on May 4.
Adidas outperformed the Zacks Consensus Estimate by an average of 37.3% in the trailing four quarters. The Zacks Consensus Estimate for both, the first-quarter and 2017 have witnessed an uptrend over the last 30 days. Further, the current Zacks Consensus Estimate of $1.07 per share for the first quarter reflects a year-over-year increase of 23.8%. Moreover, analysts polled by Zacks expect revenues of $5.8 billion, up nearly 11% from the year-ago quarter. So, let’s see how things are shaping up for this announcement.
Our proven model shows that Adidas may beat earnings because it has the right combination of the two key components.
Zacks ESP: Adidas currently has an Earnings ESP of +0.94%. This is because the Most Accurate estimate is $1.08, while the Zacks Consensus Estimate is pegged a notch lower at $1.07. A favorable Zacks ESP serves as a meaningful and leading indicator of a likely positive earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Adidas sports a Zacks Rank #1 (Strong Buy). Note that stocks with a Zacks Rank #1, 2 (Buy) or 3 (Hold) have a significantly higher chance of beating earnings. Conversely, Sell-rated stocks (#4 or 5) should never be considered going into an earnings announcement.
The combination of Adidas’ Zacks Rank #1 and a positive ESP make us reasonably confident of a positive earnings beat.
What's Driving the Better-than-Expected Earnings?
Adidas significantly outperformed the Zacks categorized Shoes & Retail Apparel industry in the past one year. The company’s shares soared 68.7% over the past year, compared with the industry’s decline of 5.8%.
The company continues to gain strength from solid performance at Adidas Group, which delivered robust revenues in 2016. Management expects to sustain this momentum and also anticipates revenue growth in 2017 to be boosted by solid performance at its core lifestyle categories. Further, the company envisions sales to jump in double-digits in key regions. Also, Adidas remains keen on enhancing its women’s business, as it foresees great scope for revenues and profitability, in this category. Together, these growth drivers, the company’s constant product launches, and its strong marketing initiatives, make us hopeful about Adidas’ upcoming results.
Other Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat:
Wal-Mart Stores, Inc. (WMT - Free Report) , scheduled to release earnings on May 18, currently has an Earnings ESP of +2.08% and a Zacks Rank #2.
Red Robin Gourmet Burgers, Inc. (RRGB - Free Report) , expected to release earnings on May 16, currently has an Earnings ESP of +17.24% and a Zacks Rank #3.
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Adidas (ADDYY) Q1 Earnings: Stock Likely to Beat Estimates?
We expect sporting goods bigwig, Adidas AG (ADDYY - Free Report) to beat expectations when it reports first-quarter 2017 results on May 4.
Adidas outperformed the Zacks Consensus Estimate by an average of 37.3% in the trailing four quarters. The Zacks Consensus Estimate for both, the first-quarter and 2017 have witnessed an uptrend over the last 30 days. Further, the current Zacks Consensus Estimate of $1.07 per share for the first quarter reflects a year-over-year increase of 23.8%. Moreover, analysts polled by Zacks expect revenues of $5.8 billion, up nearly 11% from the year-ago quarter. So, let’s see how things are shaping up for this announcement.
Adidas AG Price and EPS Surprise
Adidas AG Price and EPS Surprise | Adidas AG Quote
Why a Likely Positive Surprise?
Our proven model shows that Adidas may beat earnings because it has the right combination of the two key components.
Zacks ESP: Adidas currently has an Earnings ESP of +0.94%. This is because the Most Accurate estimate is $1.08, while the Zacks Consensus Estimate is pegged a notch lower at $1.07. A favorable Zacks ESP serves as a meaningful and leading indicator of a likely positive earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Adidas sports a Zacks Rank #1 (Strong Buy). Note that stocks with a Zacks Rank #1, 2 (Buy) or 3 (Hold) have a significantly higher chance of beating earnings. Conversely, Sell-rated stocks (#4 or 5) should never be considered going into an earnings announcement.
The combination of Adidas’ Zacks Rank #1 and a positive ESP make us reasonably confident of a positive earnings beat.
What's Driving the Better-than-Expected Earnings?
Adidas significantly outperformed the Zacks categorized Shoes & Retail Apparel industry in the past one year. The company’s shares soared 68.7% over the past year, compared with the industry’s decline of 5.8%.
The company continues to gain strength from solid performance at Adidas Group, which delivered robust revenues in 2016. Management expects to sustain this momentum and also anticipates revenue growth in 2017 to be boosted by solid performance at its core lifestyle categories. Further, the company envisions sales to jump in double-digits in key regions. Also, Adidas remains keen on enhancing its women’s business, as it foresees great scope for revenues and profitability, in this category. Together, these growth drivers, the company’s constant product launches, and its strong marketing initiatives, make us hopeful about Adidas’ upcoming results.
Other Stocks that Warrant a Look
Here are some companies you may want to consider as our model shows that these also have the right combination of elements to post an earnings beat:
Lowe's Companies, Inc. (LOW - Free Report) , slated to release earnings on May 24, currently has an Earnings ESP of +2.86% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Wal-Mart Stores, Inc. (WMT - Free Report) , scheduled to release earnings on May 18, currently has an Earnings ESP of +2.08% and a Zacks Rank #2.
Red Robin Gourmet Burgers, Inc. (RRGB - Free Report) , expected to release earnings on May 16, currently has an Earnings ESP of +17.24% and a Zacks Rank #3.
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more.Click here for a peek at this private information >>