Avon (AVP) Q3 Earnings: Stock To Deliver A Beat Again?

We expect beauty and cosmetic goods company, Avon Products Inc. (NYSE:AVP) to beat expectations when it reports third-quarter 2016 results on Nov 3. In the last quarter, the company beat earnings estimates substantially, posting a robust surprise of 133.3% that also broke its three-quarter-long trend of delivering negative surprises.

Why a Likely Positive Surprise?

Our proven model shows that Avon Products is likely to beat earnings estimates this quarter. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. The Most Accurate estimate is 4 cents and the Zacks Consensus Estimate is pegged lower at 3 cents. So the ensuing +33.33% ESP and the company’s Zacks Rank #1 (Strong Buy) make us reasonably confident of an earnings beat. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.

What is Driving the Better-than-Expected Earnings?

Avon’s efforts towards improving pricing, lowering costs, building brand strength and boosting Active Representatives have started to pay off. This was evident in the last quarter, where the company made a significant recovery, gaining from improved performances in nine of its top 10 markets in local currency. Also, Avon is constantly focused on the implementation of its Transformation Plan that was announced in Jan 2016, to curtail costs. All these factors underscore that the company is in a position to return to sustainable, profitable growth in the future, thus making us positive about the upcoming results.

Stocks to Consider

Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:

Big 5 Sporting Goods Corp. (NASDAQ:BGFV) , scheduled to release earnings on Nov 1, has an Earnings ESP of +3.33% and a Zacks Rank #1.

Marinemax Inc. (NYSE:HZO) , expected to release earnings on Nov 1, has an Earnings ESP of +31.82% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Big Lots Inc. (NYSE:BIG) , expected to release earnings on Dec 2, has an Earnings ESP of +50.00% and a Zacks Rank #2 (Buy).

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