Market Overview

Earnings Expectations: High Hopes For KB Home And Walgreens

Earnings Expectations: High Hopes For KB Home And Walgreens
  • Reports from KB Home (NYSE: KBH) and Walgreens Boots Alliance Inc (NASDAQ: WBA) highlight another quiet earnings week.
  • Top-line and bottom-line growth are predicted for both of them.
  • The fourth-quarter earnings season begins in mid-January.

While we have turned the calendar page on a new year, the fourth-quarter reporting season does not begin until mid-January, when the likes of Alcoa Inc (NYSE: AA), Intel Corporation (NASDAQ: INTC) and the first big banks take their turns in the earnings spotlight.

Yet there are a few off-season earnings reports expected this week. Among them, Wall Street analysts have high hopes for homebuilder KB Home and retailer Walgreens, as the consensus forecasts call for strong growth on the top and bottom lines for both of them.

Other highlights for the week include reports due from Bed Bath & Beyond Inc. (NASDAQ: BBBY) and Monsanto Company (NYSE: MON), for which expectations are not so high. Those expectations are featured in a separate report.

Below is a quick look at what is expected from the reports of KB Home and Walgreens, as well as a peek at some others.

Related Link: Looking To Q4 Earnings Season In 6 Charts

KB Home

In its report early January 7, this Los Angeles-based builder is expected to report that earnings per share (EPS) came to $0.52, according to eight Estimize respondents. That would be a big jump from the $0.28 per share in the year-ago period. EPS beat Wall Street expectations by a penny or two in the past two quarters.

The Estimize consensus sees revenue totaling $1.07 billion for the fiscal fourth quarter, the same as Wall Street, though they both underestimated revenue in the previous period. If they are on target this time, that would represent about 34 percent top-line growth, relative to the same period of last year.

Walgreens Boots Alliance

When this specialty retailer shares its results first thing January 7, the consensus forecast of Estimize is that it will show a profit of $0.99 per share for the fiscal first quarter. That would be up from $0.78 EPS in the same period of last year. Its earnings handily topped expectations in the past two quarters.

The company's revenue for the three months that ended in November will be $29.69 billion, or up about 50 percent year over year, if the 32 survey respondents are correct. Note though that both Estimize and Wall Street overestimated revenue in the past three periods.

And Others

Also this week, at least some growth on the bottom line is coming from Constellation Brands and Sonic, if Wall Street expectations come true. But declines in earnings are predicted for Bed Bath & Beyond and Commercial Metals. Finish Line and Monsanto are each expected to post a net loss.

And looking ahead, Alcoa is scheduled to take its turn on the earnings stage on January 11. Intel is expected to report on January 14, the same day as JPMorgan, while reports from Citigroup and Wells Fargo are due on January 15.

Image Credit: Public Domain


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