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V.F. Corp. (VFC) to Report Q4 Earnings: Is a Beat in Store?

V.F. Corporation VFC is likely to register top and bottom-line decreases from the year-ago quarter’s reported figures when it posts fourth-quarter fiscal 2023 earnings on May 23, after the closing bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $2.74 billion, indicating a 2.9% dip from the prior-year quarter’s reported figure.

The consensus estimate for earnings in the fiscal fourth quarter is pegged at 14 cents per share, suggesting a 68.9% decline from the year-ago quarter’s reported number. Earnings estimates have remained unchanged in the past 30 days. We expect fiscal fourth-quarter net revenues to decline 3.4% year over year to $2.7 billion and the bottom line to plunge 75.8% to 11 cents a share.

For fiscal 2023, the Zacks Consensus Estimate is pegged at $11.6 billion, suggesting a 1.9% decline from the prior-year quarter’s reported figure. The consensus estimate for earnings indicates a 34.9% year-over-year decline to $2.07. We expect the company’s fiscal 2023 total revenues to decrease 2% year over year to $11.6 billion and the bottom line to decline 35.6% to $2.05

V.F. Corp delivered a negative earnings surprise of 4.8% in the trailing four quarters, on average. In the last reported quarter, the company posted an earnings beat of 13.1%.

V.F. Corporation Price and EPS Surprise

V.F. Corporation price-eps-surprise | V.F. Corporation Quote

Key Factors to Note

V.F. Corp has been gaining from its Supreme buyout and cost-saving efforts. It is on track with a strategic review of its Global Packs business, consisting of the Kipling, Eastpak and JanSport brands, as well as the divestiture and leaseback of its Europe headquarters in Stabio, Switzerland. VFC has been focused on lowering working capital and optimizing inventories.

The company has been benefiting from Supreme’s strong follower base in the younger generation, even when consumers are moving away from apparel to essential spending.  Management, in its last earnings report, noted that the fall/winter season started on a solid note. The brand’s newly launched Yoji-Yamamoda collection, the Nike ACG release as well as the Andre 3000 Poster campaign bode well.

However, V.F. Corp continues to reel under a tough operating environment and continued supply-chain headwinds. The company has been witnessing higher lead times across the supply chain which should have affected business in the quarter under review. Also, increased volatility on the distribution and logistics front, particularly in the Americas, is likely to have acted as a deterrent.

The company’s China business has been facing logistics-related issues causing ongoing product delays due to impacts from the country’s eight-week lockdown during the first quarter of fiscal 2023. Currently, China has been witnessing sequential improvement as it reopens but the lower consumer spending remains a concern.

On its last earnings report, the company expected fiscal 2023 constant dollar revenue growth of 3%, down from earlier mention of 5-6%. Vans brand revenue for the fiscal year was anticipated to be down in the high-single digits, compared with the prior mentioned mid-single digits.

VFC forecasted the gross margin to decline 200 bps year over year, compared with the prior mentioned decline of 100-150 bps. Adjusted operating margin was envisioned to be 9.5%, down from the earlier mentioned 11%. V.F. Corp predicted adjusted earnings per share in the range of $2.05-$2.15, compared with $2.40-$2.50 stated earlier.

What the Zacks Model Unveils

Our proven model conclusively predicts an earnings beat for V.F. Corp 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. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

V.F. Corp has an Earnings ESP of +3.70% and a Zacks Rank of 3.

Stocks Poised to Beat Earnings Estimates

Here are some companies, which according to our model,  have the right combination of elements to post an earnings beat:

BJ's Wholesale Club BJ currently has an Earnings ESP of +4.19% and a Zacks Rank of 2.  You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is likely to register top-line growth when it reports first-quarter fiscal 2023 results on May 23. The consensus mark for BJ’s quarterly revenues is pegged at $4.81 billion, which suggests growth of 7% from the figure reported in the prior-year quarter

The Zacks Consensus Estimate for BJ’s earnings has remained constant at 84 cents per share in the past 30 days. However, the consensus estimate indicates a 3.5% decline from the figure reported in the year-ago quarter.

Deckers Outdoor Corporation DECK currently has an Earnings ESP of +7.36% and a Zacks Rank of 3. DECK is likely to register a top-line decline when it reports fourth-quarter fiscal 2023 results. The Zacks Consensus Estimate for revenues is pegged at $703.6 million, suggesting a dip of 4.4% from the prior-year quarter’s reported figure.

The consensus estimate for Deckers’ quarterly earnings has increased from $2.54 per share to $2.60 per share in the past 30 days. The consensus estimate indicates growth of 3.6% from the figure reported in the prior-year quarter. DECK has a trailing four-quarter earnings surprise of nearly 31%, on average.

lululemon athletica LULU currently has an Earnings ESP of +1.97% and a Zacks Rank of 3. LULU is expected to register a top-line and bottom-line improvement when it reports first-quarter fiscal 2023 numbers.

The Zacks Consensus Estimate for lululemon’s quarterly revenues is pegged at $1.9 billion, calling for growth of 19.5% from the prior-year quarter’s reported figure. The consensus estimate for the quarterly earnings per share of $1.93 suggests growth of 30.4% from the figure reported in the year-ago fiscal quarter. LULU has a trailing four-quarter earnings surprise of 6.8%, on average.

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

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