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Wayfair (W) to Report Q4 Earnings: A Deep Dive Wayfair Q4 Earnings Report: A Critical Analysis

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Wayfair (W) is set to announce its financial results for the fourth quarter of 2023 on February 22. The company expects revenue growth to remain in the flat to positive low single-digit range. According to the Zacks Consensus Estimate, the expected revenue is $3.10 billion, indicating a slight year-over-year growth of 0.1%. On the other hand, the consensus estimate for the bottom line is a loss of 23 cents per share, an improvement from the year-ago reported loss of $1.71 per share. Wayfair has a history of beating the Zacks Consensus Estimate, with an average earnings surprise of 57.6% in the trailing four quarters.

Wayfair Inc. Price and EPS Surprise

Wayfair Inc. Price and EPS Surprise

Wayfair Inc. price-eps-surprise | Wayfair Inc. Quote

Factors Impacting the Financials

Wayfair’s fourth-quarter results are expected to have benefited from sturdy momentum in orders, driven by lower costs and increasing customer and supplier loyalties. The estimation for the number of orders delivered is 11.6 million, signifying a 6.1% year-over-year growth.

Additionally, recurring orders from existing customers on the platform are anticipated to have contributed to the company’s revenue growth. The consensus estimate for repeat customer orders stands at 8.99 million units, indicating a 5.8% increase from the previous year.

Moreover, the company’s investments in enhancing customer experience are likely to have bolstered its performance among active customers during the quarter, with the consensus estimate for active customers showing a 2.3% growth to 22.5 million from the previous year.

Furthermore, enhancements in supplier advertising solutions and strengthened merchandising efforts across specialty and luxury brands are expected to have fueled top-line growth. However, the weakening home goods market and macroeconomic uncertainties are likely to have posed challenges for the company during the quarter.

Earnings Prediction

Our model suggests a potential earnings beat for Wayfair this quarter. With an Earnings ESP of +4.91% and a Zacks Rank #2, all signs indicate a rosy financial outcome for the company. The historical data reflects that a combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the likelihood of an earnings beat.

Comparison with Competitors

Other companies worth mentioning include The Gap (GPS), Eldorado Gold (EGO), and Booking Holdings (BKNG). The Gap has an Earnings ESP of +24.44% and a Zacks Rank #1. Eldorado Gold and Booking Holdings also show promising traits with Earnings ESP of +5.88% and +2.07% respectively along with Zacks Rank #2 and #3. These companies are anticipated to deliver strong performances in their upcoming quarterly results.

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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.