Yahoo Finance Factors Worth Watching Ahead of Sysco's (SYY) Q3 Earnings
Sysco Corporation SYY is scheduled to release third-quarter fiscal 2020 results on May 5. The company delivered a positive earnings surprise of 1.2% in the last reported quarter. Further, it has outperformed the Zacks Consensus Estimate by 4.5%, on average, in the trailing four quarters.
The Zacks Consensus Estimate for third-quarter earnings is pegged at 59 cents per share, which suggests a decrease of 25.3% from the figure reported in the year-ago quarter. The consensus mark has declined 19.2% in the past 30 days. The consensus mark for revenues stands at $13,579 million, indicating a decline of 7.4% from the year-ago period’s reported figure.
Sysco Corporation Price and EPS Surprise
Sysco Corporation price-eps-surprise | Sysco Corporation Quote
Key Factors to Note
Sysco has been grappling with cost-related headwinds for a while. Also, the company has been encountering elevated labor costs. Further, it has been exposed to volatile currency movements, given its international presence.
Sysco has, in fact, been seeing a mixed performance in its International Foodservice segment. In the last reported quarter, while sales improved in Latin America, it was soft in Canada on account of sluggish economy in some parts of the country as well as the absence of a large-chain customer. Further, the company’s Europe results were somewhat hampered by performance in France, which continued bearing the brunt of operational and supply-chain integration endeavors related to Brake France and Davigel. In its last earnings call, management said that it expects these challenges to persist throughout fiscal 2020.
Nonetheless, gains from buyouts and focus on innovation have been aiding Sysco. Notably, sales in the U.S. Foodservice division have been favorable, with local case volumes rising year over year for 23 consecutive quarters, partly owing to solid restaurant sales. Unfortunately, the coronavirus outbreak and the resultant social distancing have largely affected traffic and led to temporary restaurant closures.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Sysco 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. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Sysco carries a Zacks Rank #4 (Sell) and an Earnings ESP of -27.53%.
Stocks With Favorable Combinations
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat.
Hain Celestial HAIN has an Earnings ESP of +9.24% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Campbell Soup CPB has an Earnings ESP of +21.06% and a Zacks Rank #2.
Flowers Foods FLO has an Earnings ESP of +7.77% and a Zacks Rank #3.
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