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Box (BOX) Gears Up for Q1 Earnings: What's in the Cards?

Zacks Equity Research

Box, Inc. BOX is set to report first-quarter fiscal 2021 results on May 27. In the last reported quarter, the company delivered a positive earnings surprise of 75%.

For the to-be-reported quarter, the Zacks Consensus Estimate for earnings has remained stable at 5 cents per share over the past 30 days.

The consensus mark for revenues is pegged at $182.93 million, implying growth of 12.3% from the year-ago reported figure.

Let’s see how things have shaped up for this announcement.

Box, Inc. Price and EPS Surprise

 

Box, Inc. Price and EPS Surprise

Factors at Play

Due to mounting coronavirus fears, the demand for Box’s cloud content management solutions for companies of all sizes and industries is expected to have increased, in turn benefiting the company. Its remote-working software and services are expected to have got a boost, which is likely to have expanded the top line in the quarter.

Box invested in security, compliance and administrative technology during the fiscal first quarter. These investments helped the company capitalize on increasing adoption of cloud computing technologies and the need for secure collaboration. This in turn is likely to have driven top-line growth in the quarter to be reported.

During the quarter, Box rode high on the back of increasing adoption of the cloud content management platform by existing and new customers, including Microsoft, IBM, Splunk, Adobe, Google and many others. Expanding paid customer base is anticipated to have aided its top-line growth in the to-be-reported quarter.

Moreover, strength across international markets and growing add-on products might have aided the to-be-reported quarter’s earnings.

However, weakness in some of the regions served by the company may reflect on the upcoming results. Also, investments in research and development may have dented margins and profits in the quarter to be reported.

For the quarter to be reported, it expects revenues in the range of $183-$184 million. On a non-GAAP basis, Box projects earnings per share in the range of 4-6 cents.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Box this time around. 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. That is not the case here as you will see below.

Earnings ESP: The company has 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.

Zacks Rank: Currently, Box has a Zacks Rank #4 Sell).

Stocks That Warrant a Look

Here are a few stocks worth considering, as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

NVIDIA Corporation NVDA has an Earnings ESP of +1.60% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Shopify Inc. SHOP has an Earnings ESP of +26.62% and a Zacks Rank #2.

CrowdStrike Holdings Inc. CRWD has an Earnings ESP of +3.57% and holds a Zacks Rank of 2.

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Click to get this free report NVIDIA Corporation (NVDA) : Free Stock Analysis Report Box, Inc. (BOX) : Free Stock Analysis Report Shopify Inc. (SHOP) : Free Stock Analysis Report CrowdStrike Holdings Inc. (CRWD) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research