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Things You Need to Know Before Tapestry's (TPR) Q1 Earnings
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Tapestry, Inc. (TPR - Free Report) is slated to release first-quarter fiscal 2019 results on Oct 30. In the trailing four quarters, this house of lifestyle brands as well as designer and marketer of fine accessories and gifts has outperformed the Zacks Consensus Estimate by an average of 13.6%. In the last reported quarter, the company delivered a positive earnings surprise of 5.3%.
Investors are counting on another estimate beat by Tapestry in the to-be-reported quarter. Let’s delve deeper and take a look at the factors likely to influence the results.
How Are Estimates Shaping Up?
After registering bottom-line increase of 21% in the final quarter of fiscal 2018, Tapestry is likely to report year-over-year growth of about 4.8% in the first quarter of fiscal 2019. The Zacks Consensus Estimate for the quarter under review is pegged at 44 cents, which is couple of cents more from the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 30 days.
Analysts polled by Zacks now project revenues of $1,351 million, up from $1,288.9 million in the year-ago quarter. If all goes well, this will be the fourth straight quarter of top-line beat.
Factors Likely to Influence Tapestry’s Performance
Tapestry looks disciplined in its approach to adapt to the changing retail landscape. The company is undergoing a brand transformation and introducing modern luxury concept stores in key markets. Its long-term growth drivers include expansion of its global distribution model and venturing into under-penetrated markets. Further, the company launched Coach Create, a platform to customize bags either online or in outlets. The company also launched smartwatch with Fossil.
Additionally, the company is aggressively expanding its e-commerce platform. Tapestry also plans to undertake strategic measures involving the upgrade of core technology platforms and enhancement of international supply chain. However, sluggish mall traffic, increased online competition and aggressive pricing strategy are affecting the industry, and the company is not fully immune to it.
Nonetheless, acquisitions of Stuart Weitzman and Kate Spade are a significant step toward becoming a multi-brand company. Moreover, management has undertaken transformation initiatives revolving around product, stores and marketing, which are likely to have a favorable impact on first-quarter results.
However, escalating trade war between the United States and China poses a threat. Moreover, soft sales for Stuart Weitzman remains a concern, as earlier development and delivery delays hurt sales and margins. Management expects the segment’s top-line to return to growth in the second quarter of fiscal 2019.
Our proven model does not conclusively show that Tapestry is likely to beat estimates this quarter. A stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
American Eagle Outfitters (AEO - Free Report) has an Earnings ESP of +9.76% and a Zacks Rank #3.
Foot Locker (FL - Free Report) has an Earnings ESP of +1.00% and a Zacks Rank #3.
Zumiez (ZUMZ - Free Report) has an Earnings ESP of +2.41% and a Zacks Rank #3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Things You Need to Know Before Tapestry's (TPR) Q1 Earnings
Tapestry, Inc. (TPR - Free Report) is slated to release first-quarter fiscal 2019 results on Oct 30. In the trailing four quarters, this house of lifestyle brands as well as designer and marketer of fine accessories and gifts has outperformed the Zacks Consensus Estimate by an average of 13.6%. In the last reported quarter, the company delivered a positive earnings surprise of 5.3%.
Investors are counting on another estimate beat by Tapestry in the to-be-reported quarter. Let’s delve deeper and take a look at the factors likely to influence the results.
How Are Estimates Shaping Up?
After registering bottom-line increase of 21% in the final quarter of fiscal 2018, Tapestry is likely to report year-over-year growth of about 4.8% in the first quarter of fiscal 2019. The Zacks Consensus Estimate for the quarter under review is pegged at 44 cents, which is couple of cents more from the year-ago quarter. We note that the Zacks Consensus Estimate has remained stable in the last 30 days.
Analysts polled by Zacks now project revenues of $1,351 million, up from $1,288.9 million in the year-ago quarter. If all goes well, this will be the fourth straight quarter of top-line beat.
Factors Likely to Influence Tapestry’s Performance
Tapestry looks disciplined in its approach to adapt to the changing retail landscape. The company is undergoing a brand transformation and introducing modern luxury concept stores in key markets. Its long-term growth drivers include expansion of its global distribution model and venturing into under-penetrated markets. Further, the company launched Coach Create, a platform to customize bags either online or in outlets. The company also launched smartwatch with Fossil.
Additionally, the company is aggressively expanding its e-commerce platform. Tapestry also plans to undertake strategic measures involving the upgrade of core technology platforms and enhancement of international supply chain. However, sluggish mall traffic, increased online competition and aggressive pricing strategy are affecting the industry, and the company is not fully immune to it.
Nonetheless, acquisitions of Stuart Weitzman and Kate Spade are a significant step toward becoming a multi-brand company. Moreover, management has undertaken transformation initiatives revolving around product, stores and marketing, which are likely to have a favorable impact on first-quarter results.
However, escalating trade war between the United States and China poses a threat. Moreover, soft sales for Stuart Weitzman remains a concern, as earlier development and delivery delays hurt sales and margins. Management expects the segment’s top-line to return to growth in the second quarter of fiscal 2019.
Tapestry, Inc. Price, Consensus and EPS Surprise
Tapestry, Inc. Price, Consensus and EPS Surprise | Tapestry, Inc. Quote
What the Zacks Model Unveils?
Our proven model does not conclusively show that Tapestry is likely to beat estimates this quarter. A stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Tapestry has a Zacks Rank #3 but an Earnings ESP of -1.70%, which makes surprise prediction difficult. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Stocks With Favorable Combination
Here are three companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
American Eagle Outfitters (AEO - Free Report) has an Earnings ESP of +9.76% and a Zacks Rank #3.
Foot Locker (FL - Free Report) has an Earnings ESP of +1.00% and a Zacks Rank #3.
Zumiez (ZUMZ - Free Report) has an Earnings ESP of +2.41% and a Zacks Rank #3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>