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CSX Corporation is a big name in railway transportation. Across the energy, industrial, construction, agricultural, and consumer products markets, CSX provides rail, intermodal, and rail-to-truck transload services and solutions.
Heading into its second quarter earnings report, many investors were worried about CSX’s growth prospects after the sudden death of its CEO Hunter Harrison late last year. Those concerns, however, were quickly brushed aside as Q2 turned out to be a fantastic quarter for the company.
Both earnings and revenues easily beat the Zacks Consensus Estimate; revenues saw 6% growth year-over-year, while net income jumped 71%. CSX noted 34% and 24% growth in operating income and adjusted operating income, respectively, from the prior year period. Strong demand from central end markets like coal, chemicals, and automotive pushed CSX’s sales higher.
Thanks to these results, analysts have taken notice of CSX’s overall strength; the company has seen 12 upwards revisions in the last 60 days, driving the stock towards a Zacks Rank #1 (Strong Buy).
Additionally, our consensus estimate for fiscal 2018 has increased 30 cents over the past two months, now sitting at $3.57 per share. 2019 is looking promising too, and earnings could grow nearly 11%. Estimates for next year have increased from $3.72 per share to $3.96 over the same time period.
Known, of course, for their decadent cheesecakes, The Cheesecake Factory is a global restaurant company that owns and operates full-service, casual dining restaurants including the namesake The Cheesecake Factory, Grand Lux Café, and RockSugar Southeast Asian Kitchen.
Since reporting disappointing second quarter earnings results earlier this month, marking an earnings miss for two consecutive quarters, shares of CAKE have been on a downward spiral; CAKE actually fell they most in over 19 years directly after reporting, nosediving as much as 14%.
So what happened? Adjusted earnings of 65 cents missed the Zacks Consensus and declined 16.7% year-over-year, but revenues managed to beat the consensus and grow about 4% from the prior-year period; comparable store sales increased 1.4%.
It didn’t take long for analysts to lower their own estimates for 2018, and 11 have slashed their earnings outlook in the last 60 days; our consensus has fallen 23 cents from $2.68 to $2.45. While the consensus estimate for 2019 has dropped as well, earnings could bounce back and grow 11.5%.
CAKE is now a #5 (Strong Sell) on the Zacks Rank.
Going forward, there’s no doubt Cheesecake Factory will face some tough headwinds, especially as the overall labor market remains increasingly tight.
But, there is some good news on the horizon. CAKE expects comparable sales to increase between 1.5% to 2% this year, in addition for its top line to remain solid. The company also raised its dividend last quarter, hiking it by 14% to $0.33 a quarter; it’s yield now sits at an impressive 2.7%. And, Cheesecake Factory recently announced a partnership with delivery service DoorDash, a move that follows in the footsteps of many other casual-dining chains and one that could lead to a boost in sales.
Additional content:
5 Retail Earnings Charts Everyone Will be Talking About this Week
Earnings season is winding down but that’s when we hear from most of the retailers.
This week, over 200 companies will report earnings including the big box and department store retailers.
They were left for dead in 2016 and 2017, with many believing that Amazon would soon rule the world, but some have upped their game and the earnings picture has improved.
These five companies have both the best, and the worst, of the retail charts this week.
It’s a guarantee the Street will be talking about all of them.
5 Retail Earnings Charts to Watch This Week
1. Tapestry, Inc. has missed only once in the last 5 years but shares took a big dive after the last earnings report. They’ve recovered some off that sell off and are up 6% on the year. Tapestry does business in China. How will the tariffs impact the business?
2. Home Depot has kept its title as the king of the retail stocks. Not only that, it has one of the best charts of ALL the companies reporting this week. It’s a beast. It hasn’t missed in 5 years. Shares weakened earlier in the year, but that might have been a buying opportunity as they’re nearing new highs again.
3. Macy’s had sunk to new multi-year lows in 2017 but the selling was overdone. It has beat 4 quarters in a row now. But shares are up 52% year-to-date which has some wondering if the bullishness isn’t overdone now. Can it live up to the hype this quarter?
4. Walmart has beat 10 of the last 11 quarters but shares are weak this year. They’ve sunk nearly 9% year-to-date. Is this a buying opportunity?
5. J.C. Penney has only missed 3 times in 5 years but that’s not what investors care about right now. This is a stock on life support. Will it say something that indicates it may survive? It has the opposite looking chart of Home Depot. Shares are trading near 5-year lows.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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CSX, Cheesecake Factory, Tapestry, Home Depot, Macy's, Walmart and J.C. Penney highlighted as Zacks Bull and Bear of the Day
For Immediate Release
Chicago, IL – August 14, 2018 – Zacks Equity Research highlights CSX Corporation (CSX - Free Report) as the Bull of the Day, Cheesecake Factory (CAKE - Free Report) asthe Bear of the Day. In addition, Zacks Equity Research provides analysis onTapestry, Inc. (TPR - Free Report) , Home Depot (HD - Free Report) , Macy’s (M - Free Report) , Walmart (WMT - Free Report) and J.C. Penney .
Here is a synopsis of all three stocks:
Bull of the Day:
CSX Corporation is a big name in railway transportation. Across the energy, industrial, construction, agricultural, and consumer products markets, CSX provides rail, intermodal, and rail-to-truck transload services and solutions.
Heading into its second quarter earnings report, many investors were worried about CSX’s growth prospects after the sudden death of its CEO Hunter Harrison late last year. Those concerns, however, were quickly brushed aside as Q2 turned out to be a fantastic quarter for the company.
Both earnings and revenues easily beat the Zacks Consensus Estimate; revenues saw 6% growth year-over-year, while net income jumped 71%. CSX noted 34% and 24% growth in operating income and adjusted operating income, respectively, from the prior year period. Strong demand from central end markets like coal, chemicals, and automotive pushed CSX’s sales higher.
Thanks to these results, analysts have taken notice of CSX’s overall strength; the company has seen 12 upwards revisions in the last 60 days, driving the stock towards a Zacks Rank #1 (Strong Buy).
Additionally, our consensus estimate for fiscal 2018 has increased 30 cents over the past two months, now sitting at $3.57 per share. 2019 is looking promising too, and earnings could grow nearly 11%. Estimates for next year have increased from $3.72 per share to $3.96 over the same time period.
Bear of the Day:
Known, of course, for their decadent cheesecakes, The Cheesecake Factory is a global restaurant company that owns and operates full-service, casual dining restaurants including the namesake The Cheesecake Factory, Grand Lux Café, and RockSugar Southeast Asian Kitchen.
Since reporting disappointing second quarter earnings results earlier this month, marking an earnings miss for two consecutive quarters, shares of CAKE have been on a downward spiral; CAKE actually fell they most in over 19 years directly after reporting, nosediving as much as 14%.
So what happened? Adjusted earnings of 65 cents missed the Zacks Consensus and declined 16.7% year-over-year, but revenues managed to beat the consensus and grow about 4% from the prior-year period; comparable store sales increased 1.4%.
It didn’t take long for analysts to lower their own estimates for 2018, and 11 have slashed their earnings outlook in the last 60 days; our consensus has fallen 23 cents from $2.68 to $2.45. While the consensus estimate for 2019 has dropped as well, earnings could bounce back and grow 11.5%.
CAKE is now a #5 (Strong Sell) on the Zacks Rank.
Going forward, there’s no doubt Cheesecake Factory will face some tough headwinds, especially as the overall labor market remains increasingly tight.
But, there is some good news on the horizon. CAKE expects comparable sales to increase between 1.5% to 2% this year, in addition for its top line to remain solid. The company also raised its dividend last quarter, hiking it by 14% to $0.33 a quarter; it’s yield now sits at an impressive 2.7%. And, Cheesecake Factory recently announced a partnership with delivery service DoorDash, a move that follows in the footsteps of many other casual-dining chains and one that could lead to a boost in sales.
Additional content:
5 Retail Earnings Charts Everyone Will be Talking About this Week
Earnings season is winding down but that’s when we hear from most of the retailers.
This week, over 200 companies will report earnings including the big box and department store retailers.
They were left for dead in 2016 and 2017, with many believing that Amazon would soon rule the world, but some have upped their game and the earnings picture has improved.
These five companies have both the best, and the worst, of the retail charts this week.
It’s a guarantee the Street will be talking about all of them.
5 Retail Earnings Charts to Watch This Week
1. Tapestry, Inc. has missed only once in the last 5 years but shares took a big dive after the last earnings report. They’ve recovered some off that sell off and are up 6% on the year. Tapestry does business in China. How will the tariffs impact the business?
2. Home Depot has kept its title as the king of the retail stocks. Not only that, it has one of the best charts of ALL the companies reporting this week. It’s a beast. It hasn’t missed in 5 years. Shares weakened earlier in the year, but that might have been a buying opportunity as they’re nearing new highs again.
3. Macy’s had sunk to new multi-year lows in 2017 but the selling was overdone. It has beat 4 quarters in a row now. But shares are up 52% year-to-date which has some wondering if the bullishness isn’t overdone now. Can it live up to the hype this quarter?
4. Walmart has beat 10 of the last 11 quarters but shares are weak this year. They’ve sunk nearly 9% year-to-date. Is this a buying opportunity?
5. J.C. Penney has only missed 3 times in 5 years but that’s not what investors care about right now. This is a stock on life support. Will it say something that indicates it may survive? It has the opposite looking chart of Home Depot. Shares are trading near 5-year lows.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>
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Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.