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Macy's, Nordstrom, Wal-Mart and Amazon are part of Zacks Earnings Preview
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For Immediate Release
Chicago, IL – November 12, 2018 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Macy’s (M - Free Report) , Nordstrom (JWN - Free Report) , Wal-Mart (WMT - Free Report) and Amazon (AMZN - Free Report) .
Can Retail Stocks Build on Their Recent Gains?
The earnings focus shifts to the Retail sector this week as traditional brick-and-mortar retailers come out with quarterly results. Stocks of most of these traditional operators have outperformed the broader market this year, with the very favorable domestic consumer spending backdrop helping offset the market’s longstanding worries about the space’s competitive positioning in the emerging retail landscape of declining mall foot traffic and growing digital sales.
Given continued favorable trends in the broader economy, it is reasonable to be optimistic about earnings results from these traditional operators and their stock prices. But what will be critical to these stocks’ performance in the coming days will be management’s outlook for the coming holiday’s period. On deck to report results this week are Macy’s, Nordstrom, Wal-Mart and a number of others. In total, we have more than 300 companies reporting results this week, including 12 S&P 500 members.
Macy’s, Nordstrom and other department store stocks have been strong performers this year, with Macy’s up +50.1% and Nordstrom up +38.1% in the year-to-date period, doing better than the S&P 500’s +4.9% gain. These stocks had lost ground in the two-month period from mid-August to mid-October, but they shook off the October blues ahead of the broader market.
The Zacks Department Store industry is up +8.3% thus far in Q4 and +42.3% since the start of the year. Amazon, which reported Q3 results that the market found disappointing, is down -14.5% in Q4, but is otherwise up +46% this year. We count Amazon as part of the Zacks Retail sector that includes the traditional retailers, restaurants and online vendors like Amazon.
Given the way we define the Retail sector, this week’s results from Macy’s, Wal-Mart and others wouldn’t be the first results from this space as many of the restaurants and online vendors have already posted Q3 results. In fact, we already have Q3 results from 19 of the 38 Retail sector companies in the S&P 500 index or exactly 50% of the sector companies in the index.
Total earnings for these 19 Retail sector companies that have reported results already are up +37.5% from the same period last year on +10.7% higher revenues, with 89.5% beating EPS estimates and 63.2% beating revenue estimates.
The Retail sector results thus far are from the online vendors and restaurant players, with ‘traditional’ operators starting to report only this week. The comparison charts above show that while growth (both earnings as well as revenues) is below the preceding quarter’s level, it compares favorably with historical periods. Positive revenue surprises have been hard to come by this earnings season across all sectors and that appears to be the case with Retail as well.
With respect to the sector’s growth, Amazon’s blockbuster numbers, particularly on the revenues front, has a big role in the very strong growth picture at this stage, even though the online retail giant’s results disappointed the market.
Q3 earnings growth is still very strong, but the revenue growth rate is a lot lower on an ex-Amazon basis.
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 http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Macy's, Nordstrom, Wal-Mart and Amazon are part of Zacks Earnings Preview
For Immediate Release
Chicago, IL – November 12, 2018 – Zacks.com releases the list of companies likely to issue earnings surprises. This week’s list includes Macy’s (M - Free Report) , Nordstrom (JWN - Free Report) , Wal-Mart (WMT - Free Report) and Amazon (AMZN - Free Report) .
Can Retail Stocks Build on Their Recent Gains?
The earnings focus shifts to the Retail sector this week as traditional brick-and-mortar retailers come out with quarterly results. Stocks of most of these traditional operators have outperformed the broader market this year, with the very favorable domestic consumer spending backdrop helping offset the market’s longstanding worries about the space’s competitive positioning in the emerging retail landscape of declining mall foot traffic and growing digital sales.
Given continued favorable trends in the broader economy, it is reasonable to be optimistic about earnings results from these traditional operators and their stock prices. But what will be critical to these stocks’ performance in the coming days will be management’s outlook for the coming holiday’s period. On deck to report results this week are Macy’s, Nordstrom, Wal-Mart and a number of others. In total, we have more than 300 companies reporting results this week, including 12 S&P 500 members.
Macy’s, Nordstrom and other department store stocks have been strong performers this year, with Macy’s up +50.1% and Nordstrom up +38.1% in the year-to-date period, doing better than the S&P 500’s +4.9% gain. These stocks had lost ground in the two-month period from mid-August to mid-October, but they shook off the October blues ahead of the broader market.
The Zacks Department Store industry is up +8.3% thus far in Q4 and +42.3% since the start of the year. Amazon, which reported Q3 results that the market found disappointing, is down -14.5% in Q4, but is otherwise up +46% this year. We count Amazon as part of the Zacks Retail sector that includes the traditional retailers, restaurants and online vendors like Amazon.
Given the way we define the Retail sector, this week’s results from Macy’s, Wal-Mart and others wouldn’t be the first results from this space as many of the restaurants and online vendors have already posted Q3 results. In fact, we already have Q3 results from 19 of the 38 Retail sector companies in the S&P 500 index or exactly 50% of the sector companies in the index.
Total earnings for these 19 Retail sector companies that have reported results already are up +37.5% from the same period last year on +10.7% higher revenues, with 89.5% beating EPS estimates and 63.2% beating revenue estimates.
The Retail sector results thus far are from the online vendors and restaurant players, with ‘traditional’ operators starting to report only this week. The comparison charts above show that while growth (both earnings as well as revenues) is below the preceding quarter’s level, it compares favorably with historical periods. Positive revenue surprises have been hard to come by this earnings season across all sectors and that appears to be the case with Retail as well.
With respect to the sector’s growth, Amazon’s blockbuster numbers, particularly on the revenues front, has a big role in the very strong growth picture at this stage, even though the online retail giant’s results disappointed the market.
Q3 earnings growth is still very strong, but the revenue growth rate is a lot lower on an ex-Amazon basis.
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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 http://www.zacks.com/performance for information about the performance numbers displayed in this press release.