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3 Leisure Stocks Poised to Beat Earnings Estimates in Q1
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The leisure industry is poised to have experienced positive effects from robust demand for recreational services. The shift in consumer behavior toward finding ways to manage financial pressures rather than completely cutting back on spending may have provided some support to the industry. Despite efforts by industry participants to tailor their operations to suit consumer preferences, the leisure industry faces a complex landscape in 2024.
Heightened golfer participation from existing and new participants is expected to have driven the golf industry. Of late, the golf industry has been gaining from continued supply chain optimization and strong customer demand while achieving elevated quality and service targets. In recent years, the industry has witnessed significant investment by golf courses and retailers aiming to enhance their facilities and offerings to meet the evolving preferences of future golfers.
Looking forward to 2024, there is a sense of optimism driven by robust engagement and enthusiasm for golf, especially in the United States. Developments such as the expansion of distribution and customization capabilities, growth of fitting networks for balls and clubs and technology investments supporting B2B, D2C and enterprise systems are likely to have contributed to growth pace in the to-be-reported quarter.
The boat industry is committed to improving the consumer experience, refining pipeline management and utilizing digital marketing strategies to drive growth. Dealers are currently focused on reducing inventory levels and minimizing floorplan costs through destocking efforts, leading to heightened promotional activity and margin impact. While it is widely believed that retail demand has either reached or is nearing its lowest point, shifts in sentiment and anticipated decreases in interest rates are expected to influence the trajectory. Industry participants have reported encouraging signs that inspire cautious optimism. For the calendar year 2024, the recreational boating sector is expected to maintain sales volumes of new units consistent with those of 2023.
The cruise industry is gaining traction on the back of sustained demand strength and staycation offerings. Attributes of a strong value proposition, new ship introductions and narrowing of the pricing gap to land-based vacations are likely to have contributed positively. Companies are actively implementing strategic measures throughout their commercial capabilities to optimize distribution channels, build more customer loyalty and lower acquisition costs to enhance profitability. Many firms are reporting increased booking volumes at significantly higher prices. However, increased cruise costs (linked to higher ticket pricing and increased guest numbers) and geopolitical uncertainty are likely to act as a roadblock.
The theme park industry is likely to have benefited from increased food and beverage sales, fueled by increased consumer spending, an expanded culinary selection and a diverse range of events. Progress toward the rebuilding of the cost base (by using targeted media) and traction in dynamic pricing (for the extension of the booking curve and capturing additional admissions revenue) are anticipated to contribute positively. The industry foresees further growth potential as companies emphasize conducting tests to determine customers' willingness to pay for convenience and exploring additional revenue streams. Initiatives such as the introduction of handheld point-of-sale devices (for increased flexibility), expansion of mobile app food ordering capabilities and the integration of mobile wallets and tap-and-pay options are steps placed in the right direction. We believe that there is more upside potential as companies continue to focus on adapting to customer-preference trends.
How to Make the Right Pick?
Given the wide range of companies in this space, the task is by no means easy. While it is impossible to be sure of the outperformers, our proprietary methodology — a positive Earnings ESP along with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP is our proprietary methodology for identifying stocks that have a high chance of surprising in their upcoming earnings announcement. It shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
Our Choices
Here are a few leisure companies that investors can take a look at.
Planet Fitness’s first-quarter performance is likely to have benefitted from store expansions, strategic partnerships, membership growth and pricing adjustments. This and the adaption to the post-pandemic macroeconomic environment with the development of the New Growth Model bode well. Consistent with the strategy (for enhancing new store economics), the transition is likely to have paved a path for reduced CapEx for new builds and remodels in the to-be-reported quarter. Increased focus on the marketing engine is likely to have driven member acquisition in the first quarter.
The Zacks Consensus Estimate for first-quarter 2024 earnings per share (EPS) is pegged at 50 cents, suggesting an increase from 41 cents reported in the prior-year quarter.
Brunswick Corporation (BC - Free Report) is scheduled to report first-quarter 2024 results on Apr 25. The company has a Zacks Rank #3 and an Earnings ESP of +4.06%.
Brunswick’s first quarter performance is likely to have benefitted from the increased flow of new products, strength in the engine parts and accessories business and technological initiatives. This and the emphasis on the Brunswick Retail Finance program are likely to have stimulated demand and converted leads in the to-be-reported quarter. Normalization of inventory levels and the timing of interest rate adjustments by the Federal Reserve and global central banks may have impacted the company's performance during the first quarter.
The Zacks Consensus Estimate for first-quarter 2024 EPS is pegged at $1.36, calling for a decline from $2.57 reported in the prior-year quarter.
Six Flags Entertainment Corporation is scheduled to report first-quarter 2024 results tentatively on May 13, 2024. The company has a Zacks Rank #3 and an Earnings ESP of +7.37%.
Six Flags’ first-quarter performance is likely to have benefited from the streamlining of the organization, Six Flags Plus subscription style program and a dynamic pricing strategy. This and the addition of VIP lounges, more private cabanas, new kids areas with activities and rides, upgraded sit-down restaurants and expanded culinary offerings are likely to have aided the company’s performance in the to-be-reported quarter. Increased focus on leveraging technological investments and improving customer engagement is likely to have driven incremental revenues in the to-be-reported quarter.
The Zacks Consensus Estimate for first-quarter 2024 EPS is pegged at a loss of 90 cents per share, suggesting a deterioration from a loss of 84 cents reported in the prior-year quarter.
Six Flags Entertainment Corporation New Price and EPS Surprise
Image: Bigstock
3 Leisure Stocks Poised to Beat Earnings Estimates in Q1
The leisure industry is poised to have experienced positive effects from robust demand for recreational services. The shift in consumer behavior toward finding ways to manage financial pressures rather than completely cutting back on spending may have provided some support to the industry. Despite efforts by industry participants to tailor their operations to suit consumer preferences, the leisure industry faces a complex landscape in 2024.
Heightened golfer participation from existing and new participants is expected to have driven the golf industry. Of late, the golf industry has been gaining from continued supply chain optimization and strong customer demand while achieving elevated quality and service targets. In recent years, the industry has witnessed significant investment by golf courses and retailers aiming to enhance their facilities and offerings to meet the evolving preferences of future golfers.
Looking forward to 2024, there is a sense of optimism driven by robust engagement and enthusiasm for golf, especially in the United States. Developments such as the expansion of distribution and customization capabilities, growth of fitting networks for balls and clubs and technology investments supporting B2B, D2C and enterprise systems are likely to have contributed to growth pace in the to-be-reported quarter.
The boat industry is committed to improving the consumer experience, refining pipeline management and utilizing digital marketing strategies to drive growth. Dealers are currently focused on reducing inventory levels and minimizing floorplan costs through destocking efforts, leading to heightened promotional activity and margin impact. While it is widely believed that retail demand has either reached or is nearing its lowest point, shifts in sentiment and anticipated decreases in interest rates are expected to influence the trajectory. Industry participants have reported encouraging signs that inspire cautious optimism. For the calendar year 2024, the recreational boating sector is expected to maintain sales volumes of new units consistent with those of 2023.
The cruise industry is gaining traction on the back of sustained demand strength and staycation offerings. Attributes of a strong value proposition, new ship introductions and narrowing of the pricing gap to land-based vacations are likely to have contributed positively. Companies are actively implementing strategic measures throughout their commercial capabilities to optimize distribution channels, build more customer loyalty and lower acquisition costs to enhance profitability. Many firms are reporting increased booking volumes at significantly higher prices. However, increased cruise costs (linked to higher ticket pricing and increased guest numbers) and geopolitical uncertainty are likely to act as a roadblock.
The theme park industry is likely to have benefited from increased food and beverage sales, fueled by increased consumer spending, an expanded culinary selection and a diverse range of events. Progress toward the rebuilding of the cost base (by using targeted media) and traction in dynamic pricing (for the extension of the booking curve and capturing additional admissions revenue) are anticipated to contribute positively. The industry foresees further growth potential as companies emphasize conducting tests to determine customers' willingness to pay for convenience and exploring additional revenue streams. Initiatives such as the introduction of handheld point-of-sale devices (for increased flexibility), expansion of mobile app food ordering capabilities and the integration of mobile wallets and tap-and-pay options are steps placed in the right direction. We believe that there is more upside potential as companies continue to focus on adapting to customer-preference trends.
How to Make the Right Pick?
Given the wide range of companies in this space, the task is by no means easy. While it is impossible to be sure of the outperformers, our proprietary methodology — a positive Earnings ESP along with a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — makes it relatively simple. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP is our proprietary methodology for identifying stocks that have a high chance of surprising in their upcoming earnings announcement. It shows the percentage difference between the Most Accurate Estimate and the Zacks Consensus Estimate. Our research shows that for stocks with this combination, the chance of a positive earnings surprise is as high as 70%.
Our Choices
Here are a few leisure companies that investors can take a look at.
Planet Fitness, Inc. (PLNT - Free Report) is scheduled to report first-quarter 2024 results tentatively on May 2, 2024. The company has a Zacks Rank #3 and an Earnings ESP of +3.90%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Planet Fitness’s first-quarter performance is likely to have benefitted from store expansions, strategic partnerships, membership growth and pricing adjustments. This and the adaption to the post-pandemic macroeconomic environment with the development of the New Growth Model bode well. Consistent with the strategy (for enhancing new store economics), the transition is likely to have paved a path for reduced CapEx for new builds and remodels in the to-be-reported quarter. Increased focus on the marketing engine is likely to have driven member acquisition in the first quarter.
The Zacks Consensus Estimate for first-quarter 2024 earnings per share (EPS) is pegged at 50 cents, suggesting an increase from 41 cents reported in the prior-year quarter.
Planet Fitness, Inc. Price and EPS Surprise
Planet Fitness, Inc. price-eps-surprise | Planet Fitness, Inc. Quote
Brunswick Corporation (BC - Free Report) is scheduled to report first-quarter 2024 results on Apr 25. The company has a Zacks Rank #3 and an Earnings ESP of +4.06%.
Brunswick’s first quarter performance is likely to have benefitted from the increased flow of new products, strength in the engine parts and accessories business and technological initiatives. This and the emphasis on the Brunswick Retail Finance program are likely to have stimulated demand and converted leads in the to-be-reported quarter. Normalization of inventory levels and the timing of interest rate adjustments by the Federal Reserve and global central banks may have impacted the company's performance during the first quarter.
The Zacks Consensus Estimate for first-quarter 2024 EPS is pegged at $1.36, calling for a decline from $2.57 reported in the prior-year quarter.
Brunswick Corporation Price and EPS Surprise
Brunswick Corporation price-eps-surprise | Brunswick Corporation Quote
Six Flags Entertainment Corporation is scheduled to report first-quarter 2024 results tentatively on May 13, 2024. The company has a Zacks Rank #3 and an Earnings ESP of +7.37%.
Six Flags’ first-quarter performance is likely to have benefited from the streamlining of the organization, Six Flags Plus subscription style program and a dynamic pricing strategy. This and the addition of VIP lounges, more private cabanas, new kids areas with activities and rides, upgraded sit-down restaurants and expanded culinary offerings are likely to have aided the company’s performance in the to-be-reported quarter. Increased focus on leveraging technological investments and improving customer engagement is likely to have driven incremental revenues in the to-be-reported quarter.
The Zacks Consensus Estimate for first-quarter 2024 EPS is pegged at a loss of 90 cents per share, suggesting a deterioration from a loss of 84 cents reported in the prior-year quarter.
Six Flags Entertainment Corporation New Price and EPS Surprise
Six Flags Entertainment Corporation New price-eps-surprise | Six Flags Entertainment Corporation New Quote
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.