Investing

Earnings Previews: H&R Block, Sonos, Campbell Soup, Express

A light schedule of companies reporting earnings continues this week, with only a relative handful of companies that attract significant investor interest scheduled to report.

There was just one report of note on Monday when China-based electric vehicle maker Xpeng reported a mixed quarter but a positive delivery outlook for the current quarter.

After markets close Monday, Stitch Fix and GoHealth are on tap to report results, while sporting goods retailer Dick’s is on the schedule for Tuesday before markets open.

Here we take a look at four earnings results coming up Tuesday afternoon and Wednesday morning.

H&R Block

In 2020, H&R Block Inc. (NYSE: HRB) suffered a share price setback as the stock dropped about 28% of its value during the year. The shares have added more than 26% for the year to date and over the past 12 months, the stock is up about 8%.

The consensus analysts’ rating is basically a Hold, with four of six brokerages covering the firm issuing or maintaining Hold ratings and with two Buy ratings. The consensus price target on the stock is $19.29 and the stock recently traded above that level at $20.05. At the high price target of $25, the stock has a potential upside of around 25%.

For the fiscal third quarter that ended in January, H&R Block is expected to post a loss per share of $1.29 on revenue of $373.5 million. That’s more than double the firm’s loss in the same period a year ago. For the full fiscal year ending in April, the company is expected to post earnings per share (EPS) of $4.25, nearly four times its EPS in the prior fiscal year. Fiscal year revenue is forecast at $3.55 billion, a jump of 35% year over year.

The current quarter, which coincidentally includes the company’s busiest season of the year, is expected to see EPS of $5.12 on revenue of $2.43 billion.

At the current price, the stock is trading at around six times expected 2021 earnings and about eight times expected 2022 and 2023 EPS.

Sonos

Shares of Sonos Inc. (NYSE: SONO) rose by nearly 80% in 2020 and had added another 76% by March 1. They have pulled back by about 20 percentage points since then, but the high-end speaker maker is surely on a roll.

The stock is not widely covered by analysts. Of the six we know of, three have the stock as a Hold and the others rate Sonos a Buy. At the current price of around $37, the potential gain at a consensus price target of $40.50 is nearly 8%. At the high price target of $45, the potential upside is nearly 22%.