3D Systems (NYSE:DDD)
Information Technology - Computers & Peripherals | Reports March 15, before the open.
The Estimize community is looking for EPS of $0.04 and revenue of $179.5 million, 4 cents below Wall Street on the bottom-line, and around $3 million below on the top. 3D Systems is seeing favorable revision activity lately with earnings and sales up 10% in the past three months. Compared with the same period last year, this predicts an 84% decline in earnings while sales are expected to decline by 6%.
What to Watch: What was once expected to be the next big thing, 3D Systems (DDD) and all other 3D printing companies had a disappointing 2015. 3D Systems is coming off a dismal third quarter, posting 94% YoY declines on the bottom line while also missing its sales number. Even on a constant currency basis, revenue dipped 3%. Macroeconomic factors, particularly currency headwinds, have been the biggest hindrance to the company’s financial performance, as they generate a large portion of revenue from international markets. Last week 3D Systems received a much needed boost after rival company Stratasys reported better than expected earnings. The rival company posted a loss of -$0.01 and revenue of $173.36 million which trumped expectations by 9 cents and $6 million, respectively. In the moments following, DDD shares jumped 7% and are now up 36.94% on the year. The company remains focused on expanding its strategic partnerships and emerging in the healthcare industry to cope with weaker demand.
DSW (NYSE:DSW)
Consumer Discretionary - Specialty Retail | Reports March 15, before the open.
The Estimize consensus calls for EPS of $0.08, in-line with Wall Street, with revenue expectations of $643.47 million, roughly $2 million higher than the Street. The Select Consensus on the other hand, is showing a more modest beat of $1 million on the top line. The Estimize community has maintained an optimistic stance on DSW, revising EPS estimates up 9% since the company last reported. Compared to the year prior, current estimates predict a decline in profitability of 75%. On average, the company has consistently beat expectations, trumping the Estimize consensus 73% and Wall Street 81% of recorded quarters.
What To Watch: An interesting pattern has emerged in recent weeks, with retailers outperforming the market despite mixed quarterly earnings and weaker guidance. DSW’s upcoming fourth quarter earnings are expected to contribute to this trend. The footwear retailer beat in 2 of the past 3 quarters but consistently falls short of guidance. In the last reported quarter, DSW posted a 0.6% decline in sales while comp sales decreased 3.9% on a year-over-year basis. Yet investors responded positively, boosting shares 11.04% in the past three months. DSW’s focus on expanding its omni-channel network, smaller format stores and strategic acquisitions will be key to drive growth but also help protect them from internet competition. Earlier this year, the footwear retailer agreed to acquire online shoe retailer Ebuys for $62.5 million with a potential $55 earnings bonus on top of that. The acquisition is expected to bolster its position in ecommerce and off-price retail, two high growth areas in the industry. Ahead of its earnings next week, Goldman Sachs (NYSE:GS) and Credit Suisse (SIX:CSGN) downgraded DSW’s stock, contradicting the current trend retailers are experiencing.
Children's Place (NASDAQ:PLCE)
Consumer Discretionary - Specialty Retail | Reports March 15, before the open.
Both Estimize and Wall Street are right in line on this one, with EPS expected to come in at $1.11 and revenues anticipated at $500 million. Both of these figures have improved significantly since the company last reported earnings, with the Estimize community increasing their Q4 earnings expectations by 8% and revenues by 4%, and an even greater lift from the sell-side of 12% and 5% on each of those metrics, respectively. This would project YoY profit growth of 17% and sales growth of 3%. And while this name beats on the bottom-line around 89% historically, it only beats revenue projections 44% of the time.
What to Watch: After a period of negative top and bottom-line growth in 2013 and 2014, The Children’s Place returned to the green on earnings in 2015, while revenues remained suppressed. During the third quarter, unseasonably warm weather across most of the US caused same store sales (SSS) to dip 3% compared to the prior year. However, at the time of the announcement on December 8, fourth quarter SSS were running positive at 4.5%, representing close to half of the company’s planned sales volume for Q4. Despite continued weakness in traffic, early results were positively impacted by increases in key selling metrics. Inventories also showed an improvement at the end of Q3, down 4.4% as compared to the year-ago period. Like so many others in the retail space, PLCE continues to invest in its omni-channel strategy, with the implementation of a new distributed order management system in the latest quarter. The company plans on closing 200 stores through 2017.
Ctrip.com International (NASDAQ:CTRP)
Consumer Discretionary - Internet & Catalog Retail | Reports March 16, after the close.
The Estimize community is looking for EPS of $0.05 and revenue of $441.8 million, a nickel higher than Wall Street on the bottom line and a little over $7 million greater in sales. Ctrip has seen favorable revisions activity of late, with earnings soaring 57% in November. Compared with Q4 2014, this predicts a YoY increase on the bottom line by 130% while sales are expected to grow 42%. Historically the hospitality company has consistently beat expectations, trumping Estimize in 56% and Wall Street in 80% of recorded quarters.
What to Watch: Chinese travel has been a hot industry in the past year, prompting travel booking companies to rush to get in on the action. Leisure and outbound tourism have been the two biggest drivers for the travel market. In the fourth quarter international ticket volume grew 18.3% while China’s air passengers grew by 9.6% on a year-over-year basis. Ctrip has been the primary beneficiary of the rising travel trend, holding a dominant market position in the region. Recent partnerships with eLong and Qunar are expected to propel Ctrip’s market share in Chinese hotel and airline bookings to about 70%-80%. Moreover, Priceline’s recent $500 million investment in Ctrip will help bolster its expansion in outbound travel. Ctrip’s consolidation of the Chinese travel industry and growth in the global market gives it the scale and distribution power to generate more meaningful margins. Shareholders have been pleased with the company’s progress as shares have skyrocketed 66.91% in the past 12 months
Aeropostale (NYSE:ARO)
Consumer Discretionary - Specialty Retail | Reports March 17, after the close.
The Estimize Select Consensus calls for EPS of -$0.04, 4 cents below Wall Street, while revenue expectations of $545.8 million are $4 million under the Street. However, our Select Consensus is more bullish, expecting EPS to come in flat. The Estimize community has been optimistic on Aeropostale’s profitability in the past three months, revising EPS estimates up 54%. Since February 5 revisions have been more rampant, with earnings soaring 92% and revenues up 4%. These estimates predict as a YoY decline of 585% on the bottom line, while sales are expected to contract 7%. Aeropostale has consistently outperformed expectations, beating Wall Street in 63% of reported quarters.
What to Watch: Last week, both Abercrombie & Fitch (NYSE:ANF) and American Eagle Outfitters (NYSE:AEO) reported strong earnings, signaling a potential turnaround for teen retailers. Since then, shares of Aeropostale have soared and are now up 51.79% year to date. Investors are hoping the positive momentum created by ANF and AEO continues when Aeropostale reports fourth quarter earnings next week. Last quarter the company saw net sales decrease by 20% thanks to 10% declines in comparable sales and e-commerce channels. Aeropostale announced that they would be laying off 100 corporate employees in Q4 as part of an effort to lower expenses by $40 million a year. This comes as no surprise given the company has reported a loss in seven of the past eight quarters. Instead of trying to keep pace with fashion trends, the company remains focused on providing teens with a uniform of basic clothing. So far, that strategy has failed.