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Will Consumer Strength Fuel These Companies' Results? URBN, TJX, M
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Earnings season is slowly winding down to a halt, with a vast majority of companies already delivering their Q2 results.
It’s not over yet, though, as several consumer-facing companies – Urban Outfitters (URBN - Free Report) , Macy’s (M - Free Report) , and The TJX Companies (TJX - Free Report) – are all on the reporting docket for this week.
But what can investors expect? Let’s take a closer look.
Urban Outfitters Maintains Positive Internal Outlook
URBN shares have been volatile in 2024, seeing both negative and positive reactions to its recent quarterly results, but overall, up a solid 15%.
Analysts have downwardly revised their earnings expectations for the quarter to be released over the recent months, with the $0.98 Zacks Consensus EPS estimate down 3% and suggesting a 10% decline from the year-ago period.
Image Source: Zacks Investment Research
Nonetheless, the company’s recent set of quarterly results were highly positive, with the CEO also providing a favorable read-through for the upcoming release. Richard Hayne, CEO, said, ‘We are pleased to report record first quarter sales and earnings driven by continued strength at the Anthropologie, Free People, FP Movement and Nuuly brands. Customer demand remains robust for our spring and summer fashion, which bodes well for continued sales growth in Q2.’
Below is a chart illustrating the company’s sales on a quarterly basis.
Image Source: Zacks Investment Research
The stock is currently a Zacks Rank #4 (Sell), reflecting that investors would likely be better off waiting on the sidelines until positive earnings estimate revisions hit the tape, which would signal a meaningful change in sentiment.
Macy’s Blows Away Expectations
Macy shares haven’t seen much positivity in 2024, down roughly 10% year-to-date and unable to hold on to post-earnings gains. Results have regularly blown away expectations, though, exceeding the Zacks Consensus EPS estimate by an average of 57% across its last four releases.
Positive revisions have recently hit the tape for the release, with the $0.32 Zacks Consensus EPS estimate up 7% over the last few months and suggesting a 23% climb from the year-ago period. Though positive revisions have come for the release, the magnitude hasn’t been enough to pull the stock out of a Zacks Rank #4 (Sell).
Image Source: Zacks Investment Research
The company’s margins will undoubtedly be a focus, which have recently stabilized over recent years but did face a negative Y/Y change throughout its latest period. Please note that the chart below is on a trailing twelve-month basis.
Image Source: Zacks Investment Research
TJX Shares Hot in 2024
TJX shares have delivered a strong performance in 2024, up more than 20% and seeing a lift post-earnings following its latest release. Positive revisions recently hit the tape for the upcoming release, with the $0.92 Zacks Consensus EPS estimate up 2% over the last several months and reflecting an 8% climb Y/Y.
Image Source: Zacks Investment Research
TJX enjoyed a strong Q1 thanks to improved profitability, also raising its FY25 pretax profit margin guidance and EPS. The company maintained a positive outlook for the upcoming print, with CEO Ernie Herman stating, ‘The second quarter is off to a good start, and we see numerous opportunities for our business for the balance of the year that we plan to pursue. Longer term, we are excited about the potential we see to drive customer transactions and sales, capture additional market share, and increase the profitability of TJX.’
Most importantly, TJX’s Q1 comparable store sales increased by 3%, at the high-end of its plan and entirely driven by an increase in customer transactions. Simply put, their established locations are enjoying higher demand.
Below is a chart illustrating the company’s sales on a quarterly basis.
Image Source: Zacks Investment Research
Putting Everything Together
Many consumer-facing companies are on the reporting docket this week, including Urban Outfitters (URBN - Free Report) , Macy’s (M - Free Report) , and The TJX Companies (TJX - Free Report) .
It’s worth noting that the recent July retail sales report has helped paint a more positive picture for the upcoming releases. Concerning the data, retail sales grew 1% in July, far above Wall Street’s expectation for a +0.3% print. The data further helped cooldown recession fears, with consumers seemingly remaining in a fair spot so far.
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Will Consumer Strength Fuel These Companies' Results? URBN, TJX, M
Earnings season is slowly winding down to a halt, with a vast majority of companies already delivering their Q2 results.
It’s not over yet, though, as several consumer-facing companies – Urban Outfitters (URBN - Free Report) , Macy’s (M - Free Report) , and The TJX Companies (TJX - Free Report) – are all on the reporting docket for this week.
But what can investors expect? Let’s take a closer look.
Urban Outfitters Maintains Positive Internal Outlook
URBN shares have been volatile in 2024, seeing both negative and positive reactions to its recent quarterly results, but overall, up a solid 15%.
Analysts have downwardly revised their earnings expectations for the quarter to be released over the recent months, with the $0.98 Zacks Consensus EPS estimate down 3% and suggesting a 10% decline from the year-ago period.
Image Source: Zacks Investment Research
Nonetheless, the company’s recent set of quarterly results were highly positive, with the CEO also providing a favorable read-through for the upcoming release. Richard Hayne, CEO, said, ‘We are pleased to report record first quarter sales and earnings driven by continued strength at the Anthropologie, Free People, FP Movement and Nuuly brands. Customer demand remains robust for our spring and summer fashion, which bodes well for continued sales growth in Q2.’
Below is a chart illustrating the company’s sales on a quarterly basis.
Image Source: Zacks Investment Research
The stock is currently a Zacks Rank #4 (Sell), reflecting that investors would likely be better off waiting on the sidelines until positive earnings estimate revisions hit the tape, which would signal a meaningful change in sentiment.
Macy’s Blows Away Expectations
Macy shares haven’t seen much positivity in 2024, down roughly 10% year-to-date and unable to hold on to post-earnings gains. Results have regularly blown away expectations, though, exceeding the Zacks Consensus EPS estimate by an average of 57% across its last four releases.
Positive revisions have recently hit the tape for the release, with the $0.32 Zacks Consensus EPS estimate up 7% over the last few months and suggesting a 23% climb from the year-ago period. Though positive revisions have come for the release, the magnitude hasn’t been enough to pull the stock out of a Zacks Rank #4 (Sell).
Image Source: Zacks Investment Research
The company’s margins will undoubtedly be a focus, which have recently stabilized over recent years but did face a negative Y/Y change throughout its latest period. Please note that the chart below is on a trailing twelve-month basis.
Image Source: Zacks Investment Research
TJX Shares Hot in 2024
TJX shares have delivered a strong performance in 2024, up more than 20% and seeing a lift post-earnings following its latest release. Positive revisions recently hit the tape for the upcoming release, with the $0.92 Zacks Consensus EPS estimate up 2% over the last several months and reflecting an 8% climb Y/Y.
Image Source: Zacks Investment Research
TJX enjoyed a strong Q1 thanks to improved profitability, also raising its FY25 pretax profit margin guidance and EPS. The company maintained a positive outlook for the upcoming print, with CEO Ernie Herman stating, ‘The second quarter is off to a good start, and we see numerous opportunities for our business for the balance of the year that we plan to pursue. Longer term, we are excited about the potential we see to drive customer transactions and sales, capture additional market share, and increase the profitability of TJX.’
Most importantly, TJX’s Q1 comparable store sales increased by 3%, at the high-end of its plan and entirely driven by an increase in customer transactions. Simply put, their established locations are enjoying higher demand.
Below is a chart illustrating the company’s sales on a quarterly basis.
Image Source: Zacks Investment Research
Putting Everything Together
Many consumer-facing companies are on the reporting docket this week, including Urban Outfitters (URBN - Free Report) , Macy’s (M - Free Report) , and The TJX Companies (TJX - Free Report) .
It’s worth noting that the recent July retail sales report has helped paint a more positive picture for the upcoming releases. Concerning the data, retail sales grew 1% in July, far above Wall Street’s expectation for a +0.3% print. The data further helped cooldown recession fears, with consumers seemingly remaining in a fair spot so far.