Big Lots Inc. (NYSE: BIG) has confirmed that it will release its Q3 2021 financial results on Friday, December 3, 2021, before the market opens.
What to look for
Earnings: Stockearning’s Estimated EPS is expected to be between $0.1 and $0.2 based on mid-single-digit comp sales drop. For the full year, the company anticipates its earnings to be between $5.90 and $6.05. In the second quarter, the company's EPS was within the guidance range at $1.09 per share. Historical EPS performance shows that the company has in the past 12 quarters topped estimates nine times (75%) and missed thrice (25%) Revenue: In the second quarter, the company has net sales of $1.457 billion, representing an 11.4% decline for the same period a year ago. For the third quarter, the company expects low double digits two-year comp sales growth.
Stock movement: Since the last earnings release, the stock has lost 14.7%. Big Lots shares have been DOWN 24% times out of the past 46 quarters after the earnings release. So, the historical price reaction suggests a 52% probability of the share price going DOWN once Big Lots releases its earnings. According to the Stockearning algorithm, the predicted first-day move is 8%, while the predicted move on the seventh day is 9%.
What analysts are saying
Piper Sandler analysts Peter Keith downgraded the stock from "Buy" to "Hold" and also cut the price target from $60 to $50. According to the analyst, there is a "trifecta of macro headwinds" affecting the company's fundamentals in 1H 2022. The headwinds include ocean freight rates increasing to all-time highs, lapping two years of stimulus checks tailwinds, and wage pressure in the retail sector that doesn't seem to end son. Keith told investors in a research note that near-them macro headwinds will overshadow the company's underlying margin drivers and sales.
Also, Loop Capital’s Anthony Chukumba lowered his price target on the stock from $60 to $50 but maintained a “Buy” rating on the stock. Chukumba said that the company’s Q2 performance was uninspiring because it faced a challenging annual comparison. In a research note, the analyst told investors that Q3 2021 outlook signals that the good times could be overs, and ocean freight and supply chain issues would make the road more challenging for Big Lots.
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