Yahoo Finance Factors Setting the Tone for Brinker's (EAT) Q2 Earnings
Brinker International, Inc. EAT is scheduled to report second-quarter fiscal 2023 results on Feb 1. In the last reported quarter, the company delivered an earnings surprise of 5%.
How Are Estimates Placed?
The Zacks Consensus Estimate for the fiscal second-quarter earnings per share (EPS) is pegged at 50 cents, indicating a decline of 29.6% from 71 cents reported in the year-ago quarter.
For revenues, the consensus mark is pegged at $987.6 million, suggesting a 6.7% increase from the year-ago quarter’s figure.
Brinker International, Inc. Price and EPS Surprise
Brinker International, Inc. price-eps-surprise | Brinker International, Inc. Quote
Let's look at how things have shaped up in the quarter.
Factors at Play
Brinker International's second-quarter fiscal 2023 top line is likely to reflect benefits from solid Chili's performance, sales-building initiatives and expansion efforts. During the previous quarter, the company emphasized on streamlining operations to reduce the complexity in Chili's business. It also implemented a new pricing strategy to help expand restaurant margins and grow profits. During the fiscal first quarter, domestic comps at Chilli’s (including company-owned and franchised restaurants) rose 3.4% year over year. With an increased focus on sports-driven group viewing occasions and new menu offerings, the momentum is likely to have continued in the to-be-reported quarter. The Zacks Consensus Estimate for company sales Chili's is pegged at $842 million, indicating a rise of 6.3% year over year.
Although the company is witnessing a gradual improvement in dining occupancy, it is still lower than in the pre-pandemic era. This and costs related to various sales-boosting initiatives, advertising expenses along with commodity inflation are expected to have affected margins in the to-be-reported quarter.
What Our Model Says
Our proven model predicts an earnings beat for Brinker 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.
Earnings ESP: Brinker has an Earnings ESP of +2.82%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
Other Stocks Poised to Beat on Earnings
Here are some other stocks worth considering from the Zacks Retail-Wholesale sector, as our model shows that these have the right combination of elements to beat on earnings this season:
Yum China Holdings, Inc. YUMC has an Earnings ESP of +16.13% and a Zacks Rank #3.
Shares of Yum China have gained 35.6% in the past year. YUMC’s earnings surpassed the estimates twice in the trailing four quarters and missed twice, the average surprise being 263.4%.
Shake Shack Inc. SHAK currently has an Earnings ESP of +11.91% and a Zacks Rank #3.
Shares of Shake Shack have declined 10.2% in the past year. SHAK’s earnings beat the consensus mark in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 37.2%, on average.
Starbucks Corporation SBUX currently has an Earnings ESP of +2.09% and a Zacks Rank #3.
Shares of Starbucks have gained 11.9% in the past year. SBUX’s earnings surpassed the estimates twice in the trailing four quarters and missed twice, the average surprise being 2.1%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Starbucks Corporation (SBUX) : Free Stock Analysis Report
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