We are entering a dry spell for earnings reports until mid-January starts the carousel going again. That’s not to say that there is nothing happening, though.
One of the world’s largest software companies reports quarterly results later this week, as does one of the nation’s largest retailers. A homebuilder, a chipmaker and one of the OG meme stocks are also on deck.
Here’s a look at three firms reporting after markets close Tuesday or before they open on Wednesday.
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Campbell Soup
Over the past 12 months, shares of Campbell Soup Co. (NYSE: CPB) are down about 11%, while the consumer staples sector has gained about 8.4%. Margins are the thing to watch for here. Has the company been able to pass along rising prices for food to its customers? While that may be important to small investors, remember that more than 80% of the company’s total float is owned by institutions that are unlikely to dump the shares’ solid dividend yield. Campbell Soup reports results before markets open Wednesday.
Sentiment on the stock is mixed, with 11 of 18 brokerages giving the stock a Hold rating. Just three have a Buy or Strong Buy rating, and the rest rate the stock a Strong Sell. At a recent price of around $41.90 a share, the upside potential based on a median price target of $45 is 7.4%. At the high price target of $54, the upside potential is about 29%.
For the company’s first quarter of fiscal 2022, the consensus revenue estimate is $2.28 billion, which would be up 21.6% sequentially but down about 2.6% year over year. Adjusted earnings per share (EPS) are forecast at $0.81, up 47.3% sequentially and down 18.6% year over year. For the full fiscal year, current estimates call for EPS of $2.76, down 7.4%, on sales of $8.44 billion, down less than 1%.
Campbell Soup’s share price to earnings multiple for fiscal 2022 is 15.5. For fiscal 2023, the multiple to estimated EPS of $2.93 is 14.3, and for 2024, it is 13.4 times estimated EPS of $3.13. The stock’s 52-week range is $39.76 to $53.77. Campbell Soup pays an annual dividend of $1.48 (yield of 3.60%). Total shareholder return for the past year was negative 11.4%.
Stitch Fix
Online retailer Stitch Fix Inc. (NASDAQ: SFIX) has seen its stock price drop by about a third over the past 12 months. In early July, the stock traded up 78% for the same period, so the decline has been precipitous. Since its January high, the stock price has dropped by 80%. The company reports first-quarter fiscal 2022 results after markets close Tuesday.
Inventory problems surfaced in the second half of the year, and as brick-and-mortar stores have reopened, Stitch Fix’s business model has taken a few lumps. The company is going to expand its offerings to include men’s and children’s clothing and is also expected to begin a direct buying program in addition to its monthly subscription plan.
Analysts are mixed on the stock, with 10 of 17 rating the shares at Hold and five at Buy. At a share price of around $23.80, the upside potential based on a median price target of $46 is 93%. At the high target of $70, the upside potential is 194%.
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First-quarter revenue is forecast at $570.49 million, basically flat sequentially but up 16% year over year. Stitch Fix is expected to post an adjusted per-share loss of $0.13, compared to a profit of $0.19 in the prior quarter and a profit of $0.09 per share a year ago. For the full fiscal year, the adjusted net loss is currently forecast at $0.67, worse than last year’s loss of $0.08 per share. Full-year revenue is forecast at $2.44 billion, up 15.9% compared to the prior year.
Stitch Fix is not expected to post a profit in 2022 or 2023. The share price to earnings multiple for 2024 based on a full-year EPS of $0.74 is 32.3. The stock’s 52-week range is $22.04 to $113.76. The low was posted Monday morning. Stitch Fix does not pay a dividend. And the total return for the past year is negative 32.3%.
Toll Brothers
Homebuilder Toll Brothers Inc. (NYSE: TOL) posted a new 52-week high Monday morning, as the home building market has picked up again. While the increase is nothing like the 400% jump between March of 2020 and May of this year, the change is certainly welcome.
Toll Brothers and other large homebuilders (PulteGroup, Lennar, D.R. Horton) are believed to be in a good position as the homebuilding industry tries to meet the demand for more than a million new single-family homes after a decade of demand at least 25% below that level. A housing analyst at Evercore ISI told Barron’s, “The supply shortage built up over 10 years, and it won’t go away quickly.”
Sentiment on the stock is not as bullish. Of 19 brokerages covering the company, nine have a Buy or Strong Buy rating and six rate the shares at Hold. The other four have a Strong Sell rating on the stock. At a share price of around $69.90, the stock has passed its median price target of $67.50. At the high price target of $86, the upside potential is 23%.
When the company reports fourth-quarter fiscal 2021 results after markets close Tuesday, analysts expect to see revenue of $2.91 billion, up 29% sequentially and 14% year over year. Adjusted EPS are forecast at $2.50, up 33.7% sequentially and 49% year over year. For the full year, analysts expect EPS of $6.23, up 83.3%, on sales of $8.62 billion, up 22.0%.
Toll Brothers’ share price to earnings multiple for fiscal 2021 is 11.2. For fiscal 2022, the multiple to estimated EPS of $9.02 is 7.7, and for 2024, it is 7.1 times estimated EPS of $9.84. The stock’s 52-week range is $41.22 to $71.17. The company pays an annual dividend of $0.68 (yield of 0.99%). Total shareholder return for the past year was about 47.2%.
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