Back to top

Image: Bigstock

Columbia Sportswear (COLM) Q2 Earnings Coming Up: Things to Note

Read MoreHide Full Article

Columbia Sportswear Company (COLM - Free Report) is likely to register a top and bottom-line decrease when it reports second-quarter 2024 earnings on Jul 25. The Zacks Consensus Estimate for revenues is pegged at $573.4 million, which indicates a 7.7% decline from the year-ago period.

The consensus mark for the bottom line has deteriorated by a penny in the past seven days to a loss of 31 cents per share. This indicates a substantial decline from the year-ago quarter’s earnings of 14 cents. That said, COLM has a trailing four-quarter earnings surprise of 174.3%, on average.

Factors to Note

Columbia Sportswear has been navigating a tough operating landscape in the United States and sluggish overall demand. North America continues to be the most challenging market. Consumers are still grappling with inflationary pressures that are affecting soft goods demand. Trends in the traditional outdoor category remain weak, particularly in footwear, and retailers are adopting a cautious approach in placing future season orders. For the second quarter of 2024, COLM anticipates a net sales decline of 10-7% to the $557-$576 million range.

Columbia Sportswear Company Price, Consensus and EPS Surprise

Columbia Sportswear Company Price, Consensus and EPS Surprise

Columbia Sportswear Company price-consensus-eps-surprise-chart | Columbia Sportswear Company Quote

SG&A costs, as a percentage of sales, have been increasing year over year for a while now. In the first quarter of 2024, the metric expanded 310 bps to 45.4% due to elevated direct-to-consumer (DTC) expenses. The persistence of these headwinds is a concern. Our model suggests SG&A expenses, as a percentage of sales, will expand 410 basis points to 54.4% in the second quarter. 

COLM expects to deliver an operating loss in the band of $42-$27 million in the second quarter. For the bottom line, management envisions delivering a loss in the range of 46-26 cents per share in the quarter.

However, Columbia Sportswear has been benefiting from its brand-enhancing and unique marketing initiatives. Also, the company’s efforts to enhance operational efficiency and protect profits through its multi-year profit improvement program bode well.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Columbia Sportswear this time. 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, which is not the case here. 

Columbia Sportswear currently carries a Zacks Rank #3, while it has an Earnings ESP of -8.20%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

Colgate-Palmolive (CL - Free Report) currently has an Earnings ESP of +0.45% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here. The company is expected to register top and bottom-line growth when it reports second-quarter 2024 numbers. The Zacks Consensus Estimate for CL’s quarterly revenues is pegged at $5 billion, which suggests growth of 4.1% from the prior-year quarter’s reported figure. 

The Zacks Consensus Estimate for Colgate-Palmolive’s quarterly earnings has been unchanged in the past 30 days at 87 cents per share. The estimate suggests almost 13% growth from the year-ago reported quarter. CL delivered an earnings surprise of 4.4%, on average, in the trailing four quarters.

Kimberly-Clark Corporation (KMB - Free Report) currently has an Earnings ESP of +0.27% and a Zacks Rank #2. The company is likely to register a decrease in the top line when it reports second-quarter 2024 numbers. The consensus mark for revenues is pegged at $5.08 billion, which implies a decline of 1.1% from the figure reported in the year-ago quarter.

The Zacks Consensus Estimate for Kimberly-Clark’s quarterly earnings per share of $1.68 suggests a 1.8% increase from the year-ago quarter. KMB has a trailing four-quarter earnings surprise of 11.3%, on average.

Clorox (CLX - Free Report) has an Earnings ESP of +1.51% and a Zacks Rank of 3 at present. The company is expected to register a top and bottom-line decline when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for CLX’s quarterly earnings has risen by a penny in the past seven days to $1.54 per share, which indicates a fall of 7.8% from the year-ago period quarter.

The Zacks Consensus Estimate for Clorox’s quarterly revenues is pegged at $1.98 billion, which indicates a drop of around 2% from the figure reported in the year-ago quarter. CLX has a trailing four-quarter earnings surprise of 128.5%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Published in