Market Overview

High Earnings Expectations For Costco, Lululemon

High Earnings Expectations For Costco, Lululemon
  • Quarterly reports from a pair of specialty retailers are due this week.
  • Wall Street analysts have forecast earnings growth from each of them.
  • Only a handful of other prominent companies are on deck to report this week.

As the quarter and the calendar year wind down, things turn quiet on the earnings front. Yet, the latest quarterly numbers from specialty retailers Costco Wholesale Corporation (NASDAQ: COST) and Lululemon Athletica inc. (NASDAQ: LULU) will be among the highlights this week.

The consensus Wall Street forecasts see top- and bottom-line growth for the membership warehouse operator for the three months that included an announcement that some fees would be raised. The yoga apparel focused retailer is also expected to show earnings and revenue gains year-over-year, in the period that included some chatter about going private.

Costco Up To Bat

When Costco shares its fiscal first-quarter results, analysts, on average, predict its earnings per share (EPS) will have grown by 11 cents from a year ago to $1.20. The $28.29 billion in expected revenue would be almost a 4 percent gain. Note that this purveyor of everything from car tires to fine wines to eyeglasses topped the consensus EPS estimates in the previous two quarters.

The forecast from 67 Estimize respondents is a bit more optimistic, with EPS coming in at $1.22. And the consensus revenue estimate for the three months that ended in November is $28.50 billion. Estimize also narrowly underestimated earnings in the previous two quarters, though revenue fell a bit short in the fourth quarter.

Lululemon In Focus

Wall Street's consensus forecast for Lululemon calls for EPS to have climbed from $0.35 in the same period of last year to $0.43. However, note that this Canadian retailer of apparel matched analysts' EPS expectations in the previous quarter. The 103 Estimize respondents have a consensus estimate of $0.44 per share for the three months that ended in October, which is at the top the company guidance range.

Unlike Wall Street, Estimize narrowly overestimated revenue in the previous quarter, and this time, the respondents are looking for $544.17 million. That would be around 13 percent higher than in the year-ago period. Wall Street's consensus forecast is $540.67 million. Both estimates fall within the company's guidance range.

Both Costco and Lululemon are scheduled to report their latest results after the closing bell on Wednesday.

Also This Week

Other notable companies also scheduled to report this week include AutoZone, Broadcom, Brown-Forman, Ciena, HD Supply and Toll Brothers, which are also expected to have a gain on the bottom line. From Bank of Montreal, Casey's General Stores, Restoration Hardware and United Natural Foods, an earnings decline, compared with a year ago, is anticipated. A net loss is in the cards for H&R Block, if the analysts are correct.

Latest Ratings for COST

Jun 2019MaintainsEqual-Weight
May 2019MaintainsNeutral
May 2019DowngradesAccumulateHold

View More Analyst Ratings for COST
View the Latest Analyst Ratings

Posted-In: Earnings News Previews Crowdsourcing Analyst Ratings Movers Trading Ideas General Best of Benzinga


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