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How Capri Holdings (CPRI) Looks Just Ahead of Q2 Earnings
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Capri Holdings Limited (CPRI - Free Report) is likely to register top- and bottom-line declines when it reports second-quarter fiscal 2021 numbers on Nov 5, before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $947.4 million, which indicates a slump of 34.3% from the year-ago quarter’s reported figure. Nonetheless, we note that the rate of sales decline is likely to decelerate on a sequential basis. The company had witnessed a decline of 66.5% in the last reported quarter.
The Zacks Consensus Estimate for quarterly earnings went up by 4 cents in the past seven days and is currently pegged at 5 cents per share. The current Zacks Consensus Estimate indicates that the company is likely to swing back to profit following a loss in the last reported quarter. However, the consensus estimate suggests a sharp decline from earnings of $1.16 reported in the year-ago quarter.
Capri Holdings Limited Price, Consensus and EPS Surprise
Despite the reopening of stores, the impact of coronavirus on Capri Holdings’ second-quarter performance cannot be ignored. On its last earnings call, management guided a sales decline of nearly 40% for the to-be-reported quarter. Sluggishness in the wholesale and retail channels is likely to have marred the company’s top line during the quarter under review.
Management had also highlighted that despite gradual improvements in shopping trends, wholesale shipment recovery is likely to remain slow. Wholesale sales during the second quarter are likely to have been negatively impacted by limited replenishment orders. Moreover, travel retail, which is part of the wholesale channel, has been bearing the brunt of decline in tourism. Demand for high-end fashion clothing and accessories have also remained soft, as consumers continue to remain cautious of any discretionary purchases.
Nonetheless, to address the challenges tied to the pandemic, Capri Holdings has been focusing on cutting operating expenses, lowering capital expenditures and managing inventory.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Capri Holdings 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.
Capri Holdings carries a Zacks Rank #3 and an Earnings ESP of +460.00%.
Stocks Poised to Beat Earnings Estimates
Here are some more companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.
Dollar General Corporation (DG - Free Report) currently has an Earnings ESP of +8.17% and a Zacks Rank #2.
Best Buy Co., Inc. (BBY - Free Report) has an Earnings ESP of +14.92% and a Zacks Rank #2, at present.
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How Capri Holdings (CPRI) Looks Just Ahead of Q2 Earnings
Capri Holdings Limited (CPRI - Free Report) is likely to register top- and bottom-line declines when it reports second-quarter fiscal 2021 numbers on Nov 5, before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $947.4 million, which indicates a slump of 34.3% from the year-ago quarter’s reported figure. Nonetheless, we note that the rate of sales decline is likely to decelerate on a sequential basis. The company had witnessed a decline of 66.5% in the last reported quarter.
The Zacks Consensus Estimate for quarterly earnings went up by 4 cents in the past seven days and is currently pegged at 5 cents per share. The current Zacks Consensus Estimate indicates that the company is likely to swing back to profit following a loss in the last reported quarter. However, the consensus estimate suggests a sharp decline from earnings of $1.16 reported in the year-ago quarter.
Capri Holdings Limited Price, Consensus and EPS Surprise
Capri Holdings Limited price-consensus-eps-surprise-chart | Capri Holdings Limited Quote
Aspects That May Impact Q2 Metrics
Despite the reopening of stores, the impact of coronavirus on Capri Holdings’ second-quarter performance cannot be ignored. On its last earnings call, management guided a sales decline of nearly 40% for the to-be-reported quarter. Sluggishness in the wholesale and retail channels is likely to have marred the company’s top line during the quarter under review.
Management had also highlighted that despite gradual improvements in shopping trends, wholesale shipment recovery is likely to remain slow. Wholesale sales during the second quarter are likely to have been negatively impacted by limited replenishment orders. Moreover, travel retail, which is part of the wholesale channel, has been bearing the brunt of decline in tourism. Demand for high-end fashion clothing and accessories have also remained soft, as consumers continue to remain cautious of any discretionary purchases.
Nonetheless, to address the challenges tied to the pandemic, Capri Holdings has been focusing on cutting operating expenses, lowering capital expenditures and managing inventory.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Capri Holdings 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.
Capri Holdings carries a Zacks Rank #3 and an Earnings ESP of +460.00%.
Stocks Poised to Beat Earnings Estimates
Here are some more companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.
Lowes Companies, Inc. (LOW - Free Report) currently has an Earnings ESP of +2.90% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar General Corporation (DG - Free Report) currently has an Earnings ESP of +8.17% and a Zacks Rank #2.
Best Buy Co., Inc. (BBY - Free Report) has an Earnings ESP of +14.92% and a Zacks Rank #2, at present.
Legal Marijuana: An Investor’s Dream
Imagine getting in early on a young industry primed to skyrocket from $17.7 billion in 2019 to an expected $73.6 billion by 2027.
Although marijuana stocks did better as the pandemic took hold than the market as a whole, they’ve been pushed down. This is exactly the right time to get in on selected strong companies at a fraction of their value before COVID struck. Zacks’ Special Report, Marijuana Moneymakers, reveals 10 exciting tickers for urgent consideration.
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