HomeMost PopularInvestingAssessing BJ's Wholesale Club (BJ) Ahead of Q1 Earnings

Assessing BJ’s Wholesale Club (BJ) Ahead of Q1 Earnings

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BJ’s Wholesale Club Holdings, Inc. BJ is likely to register an increase in the top line when it reports first-quarter fiscal 2024 results on May 23 before market open. The Zacks Consensus Estimate for revenues is pegged at $4,862 million, which indicates growth of 3% from the prior-year reported figure.

The bottom line of this operator of membership warehouse clubs is expected to decrease year over year. The Zacks Consensus Estimate for first-quarter earnings per share has been stable at 84 cents over the past 30 days. The consensus estimate suggests a decline of 1.2% from the year-ago quarter.

BJ’s Wholesale has a trailing four-quarter earnings surprise of 4.2%, on average. In the last reported quarter, this Westborough, MA-based company’s bottom line surpassed the Zacks Consensus Estimate by a margin of 4.7%.

Factors to Consider

BJ’s Wholesale’s focus on simplifying assortments, boosting marketing and merchandising capabilities, expanding into high-demand categories and building an own-brand portfolio is commendable. The company remains committed to enhancing omnichannel capabilities, expediting the opening of new clubs and providing value for customers. These endeavors have been contributing to growth in membership signups and renewals.

The first quarter is anticipated to reflect the positive impact of BJ’s Wholesale’s emphasis on better pricing, private-label offerings, merchandise initiatives and digital solutions. These factors are expected to contribute favorably to the company’s top-line performance. We expect merchandise comparable club sales to increase 0.5% for the quarter under review.

However, the quarter may also reveal challenges, particularly in the form of potential deleverage in SG&A expenses, which could adversely affect margins. We anticipate a 5% year-over-year increase in SG&A expenses for the first quarter, leading to a deleverage of 30 basis points as a percentage of total revenues.

BJ’s Wholesale Club Holdings, Inc. Price, Consensus and EPS Surprise

BJ's Wholesale Club Holdings, Inc. Price, Consensus and EPS Surprise

BJ’s Wholesale Club Holdings, Inc. price-consensus-eps-surprise-chart | BJ’s Wholesale Club Holdings, Inc. Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for BJ’s Wholesale this time. 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. However, that’s not the case here.

BJ’s Wholesale has a Zacks Rank #3 but 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.

Stocks With the Favorable Combination

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

Target TGT currently has an Earnings ESP of +6.39% and carries a Zacks Rank #3. The Zacks Consensus Estimate for first-quarter fiscal 2024 earnings per share is pegged at $2.05, flat year over year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Target’s top line is expected to decline year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $24.5 billion, which indicates a drop of 3.2% from the figure reported in the prior-year quarter. TGT has a trailing four-quarter earnings surprise of 27.1%, on average.

Macy’s M currently has an Earnings ESP of +48.57% and a Zacks Rank of 3. The company is likely to register a decrease in the bottom line when it reports first-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of 18 cents suggests a sharp decline from the year-ago reported number of 56 cents.

Macy’s top line is also expected to decrease year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $4.82 billion, which suggests a decline of 3.2% from the prior-year quarter. Macy’s has a trailing four-quarter earnings surprise of 47.7%, on average.

American Eagle Outfitters AEO currently has an Earnings ESP of +6.84% and a Zacks Rank #3. The company is likely to register an increase in the bottom line when it reports first-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of 27 cents suggests a jump of 58.8% from the year-ago quarter.

American Eagle Outfitters’ top line is anticipated to rise year over year. The consensus mark for revenues is pegged at $1.15 billion, which implies an increase of 5.9% from the figure reported in the year-ago quarter. AEO has a trailing four-quarter earnings surprise of 22.7%, on average.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Macy’s, Inc. (M) : Free Stock Analysis Report

Target Corporation (TGT) : Free Stock Analysis Report

American Eagle Outfitters, Inc. (AEO) : Free Stock Analysis Report

BJ’s Wholesale Club Holdings, Inc. (BJ) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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