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Slack (WORK) to Report Q3 Earnings: What's in the Cards?

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Slack Technologies, Inc. (WORK - Free Report) will report third-quarter fiscal 2020 results on Dec 4, after the bell.

Shares of the company have slumped 38.7% since it went public in June 2019 compared with the 9.1% decline of the industry it belongs to.

Factors at Play

The Zacks Consensus Estimate for revenues in the to-be-reported quarter is pegged at $155 million, indicating sequential growth of 6.9%. Expansion of existing paid customers and addition of new paid customers are expected to have driven the top line. In the second quarter of fiscal 2020, the company’s revenues of $145 million increased 7.4% sequentially.

The consensus mark for the bottom line is pegged at a loss of 9 cents, indicating a decline from a loss of 98 cents incurred in the prior quarter. Loss is likely to have narrowed due to a significant sequential decline in general and administrative expenses.  Notably, in the second quarter of fiscal 2020, the company incurred an incremental direct listing-related cost of $28 million.

What Our Model Says

Our proven model predicts an earnings beat for Slack this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

Slack has an Earnings ESP of +9.43% and a Zacks Rank #2.

Other Stocks to Consider

Here are a few other stocks that investors may consider as our model shows that these too have the right combination of elements to beat on third-quarter fiscal 2020 earnings:

Dollar General Corporation (DG - Free Report) has an Earnings ESP of +1.23% and a Zacks Rank #2. The company is slated to report results on Dec 5. You can see the complete list of today’s Zacks #1 Rank stocks here.

Big Lots, Inc. (BIG - Free Report) has an Earnings ESP of +3.85% and a Zacks Rank #3. The company is slated to report results on Dec 6.

Signet Jewelers Limited (SIG - Free Report) has an Earnings ESP of +3.74% and a Zacks Rank #3. The company is slated to release results on Dec 5.

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