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Here's What to Expect From JAKKS Pacific (JAKK) Q2 Earnings
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JAKKS Pacific, Inc. (JAKK - Free Report) is scheduled to report second-quarter 2024 results on Jul 31, after market close. In the last reported quarter, the company reported a negative earnings surprise of 240.6%.
How Are Estimates Placed?
The Zacks Consensus Estimate for the second-quarter bottom line is pegged at 86 cents per share, indicating a decline of 31.8% from $1.26 reported in the year-ago quarter.
For revenues, the consensus mark is pegged at $162.4 million. The projection suggests a deterioration of 2.7% from the year-ago quarter’s reported figure.
Let’s analyze the factors that are likely to make an impact this earnings season.
Factors to Note
JAKKS Pacific’s second-quarter performance is likely to have been negatively impacted by strong headwinds from seasonality, increased investments and shifting of market dynamics.
Dismal contributions from seasonal and costume divisions are likely to be reflected in the company’s second-quarter top line. Attributes of high container costs, inventory backups and retailers' critical views on allocating floor space are likely to have affected JAKK’s seasonal business in the second quarter. Also, stability issues in the costume segment in a post-COVID environment are likely to have added to the negatives. Our model predicts second-quarter costume segment revenues to fall 9.3% year over year to $44.5 million.
The company has been ramping up its investments in infrastructure and expanding its European and Mexican distribution capabilities. Although expenses are termed essential for long-term growth, the initiative is likely to have dented margins in the second quarter. Our model predicts second-quarter gross margins to be at 26.8% compared with 30.7% reported in the prior-year quarter.
The bankruptcy of major customers, such as Toys "R" Us, in recent years has significantly altered market dynamics for JAKKS Pacific. Despite efforts to focus on core businesses and improve margins, the market shifts continue to present challenges. This, along with the lack of new entertainment releases, is likely to have impacted the company’s performance in the second quarter.
The emphasis on strategic expansion into new categories, international footprint and license acquisitions for product enhancements are likely to have aided the company’s performance in the second quarter.
What the Zacks Model Unveils
Our proven model does not predict an earnings beat for JAKKS Pacific 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. But that's not the case here.
Earnings ESP: JAKKS Pacific has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company has a Zacks Rank #5 (Strong Sell).
Stocks Poised to Beat Earnings Estimates
Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat.
HGV’s earnings for the second quarter are expected to increase 4.7%. The company posted better-than-expected earnings in each of the trailing four quarters, the average surprise being 7.2%.
Hyatt Hotels Corporation (H - Free Report) currently has an Earnings ESP of +48.96% and a Zacks Rank of 3.
H’s earnings topped the Zacks Consensus Estimate in two of the last four quarters and missed on the remaining two occasions, the average surprise being 20.3%. Earnings for the second quarter are expected to increase 57.3% year over year.
MGM Resorts International (MGM - Free Report) currently has an Earnings ESP of +15.35% and a Zacks Rank of 3.
MGM’s earnings for the second quarter of 2024 are expected to increase 11.9%. The company reported better-than-expected earnings in each of the last four quarters, the average surprise being 27.3%.
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Here's What to Expect From JAKKS Pacific (JAKK) Q2 Earnings
JAKKS Pacific, Inc. (JAKK - Free Report) is scheduled to report second-quarter 2024 results on Jul 31, after market close. In the last reported quarter, the company reported a negative earnings surprise of 240.6%.
How Are Estimates Placed?
The Zacks Consensus Estimate for the second-quarter bottom line is pegged at 86 cents per share, indicating a decline of 31.8% from $1.26 reported in the year-ago quarter.
For revenues, the consensus mark is pegged at $162.4 million. The projection suggests a deterioration of 2.7% from the year-ago quarter’s reported figure.
JAKKS Pacific, Inc. Price and EPS Surprise
JAKKS Pacific, Inc. price-eps-surprise | JAKKS Pacific, Inc. Quote
Let’s analyze the factors that are likely to make an impact this earnings season.
Factors to Note
JAKKS Pacific’s second-quarter performance is likely to have been negatively impacted by strong headwinds from seasonality, increased investments and shifting of market dynamics.
Dismal contributions from seasonal and costume divisions are likely to be reflected in the company’s second-quarter top line. Attributes of high container costs, inventory backups and retailers' critical views on allocating floor space are likely to have affected JAKK’s seasonal business in the second quarter. Also, stability issues in the costume segment in a post-COVID environment are likely to have added to the negatives. Our model predicts second-quarter costume segment revenues to fall 9.3% year over year to $44.5 million.
The company has been ramping up its investments in infrastructure and expanding its European and Mexican distribution capabilities. Although expenses are termed essential for long-term growth, the initiative is likely to have dented margins in the second quarter. Our model predicts second-quarter gross margins to be at 26.8% compared with 30.7% reported in the prior-year quarter.
The bankruptcy of major customers, such as Toys "R" Us, in recent years has significantly altered market dynamics for JAKKS Pacific. Despite efforts to focus on core businesses and improve margins, the market shifts continue to present challenges. This, along with the lack of new entertainment releases, is likely to have impacted the company’s performance in the second quarter.
The emphasis on strategic expansion into new categories, international footprint and license acquisitions for product enhancements are likely to have aided the company’s performance in the second quarter.
What the Zacks Model Unveils
Our proven model does not predict an earnings beat for JAKKS Pacific 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. But that's not the case here.
Earnings ESP: JAKKS Pacific has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company has a Zacks Rank #5 (Strong Sell).
Stocks Poised to Beat Earnings Estimates
Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat.
Hilton Grand Vacations (HGV - Free Report) currently has an Earnings ESP of +16.12% and a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
HGV’s earnings for the second quarter are expected to increase 4.7%. The company posted better-than-expected earnings in each of the trailing four quarters, the average surprise being 7.2%.
Hyatt Hotels Corporation (H - Free Report) currently has an Earnings ESP of +48.96% and a Zacks Rank of 3.
H’s earnings topped the Zacks Consensus Estimate in two of the last four quarters and missed on the remaining two occasions, the average surprise being 20.3%. Earnings for the second quarter are expected to increase 57.3% year over year.
MGM Resorts International (MGM - Free Report) currently has an Earnings ESP of +15.35% and a Zacks Rank of 3.
MGM’s earnings for the second quarter of 2024 are expected to increase 11.9%. The company reported better-than-expected earnings in each of the last four quarters, the average surprise being 27.3%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.