VSasey’s General Stores (CASY) posted quarterly earnings of $1.71 per share, beating Zacks consensus estimate of $1.45 per share. That compares to earnings of $1.04 per share a year ago. These figures are adjusted for non-recurring items.
This quarterly report represents a profit surprise of 17.93%. A quarter ago, this convenience store chain was expected to post a profit of $2.92 per share when it actually produced a profit of $2.59, delivering a surprise of -11.30 %.
In the past four quarters, the company has exceeded consensus EPS estimates three times.
The sustainability of the immediate stock price movement based on recently released numbers and future earnings forecasts will primarily depend on management’s comments on the earnings call.
Casey’s shares are down about 10% year-to-date compared to a -11.9% drop for the S&P 500.
What’s next for Casey’s?
With Casey’s outperforming the market so far this year, the question on investors’ minds is: what’s next for the stock?
There is no easy answer to this key question, but a reliable measure that can help investors answer it is the company’s earnings outlook. This includes not only current consensus earnings expectations for the upcoming quarter(s), but also how those expectations have changed recently.
Empirical research shows a strong correlation between short-term stock movements and trends in earnings estimate revisions. Investors can track these revisions on their own or rely on a proven scoring tool like Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Before that Press release, the trend of estimate revisions for Casey’s: favorable. While the magnitude and direction of estimate revisions may change following the release of the company’s earnings report, the current situation results in a Zacks No. 2 (buy) ranking for the stock. Thus, stocks are expected to outperform the market in the near future. You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.
It will be interesting to see how the estimates for the next few quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.40 on $3.01 billion in revenue for the upcoming quarter and $8.64 on $12.51 billion in revenue for the current fiscal year.
Investors should be aware that the outlook for the sector can also have a significant impact on stock performance. In terms of Zacks industry rankings, Retail – Convenience is currently in the top 3% of Zacks 250+ industries. Our research shows that the top 50% of industries ranked by Zacks outperform the bottom 50% by a factor of more than 2 to 1.
Designer Brands (DBI), another stock in the broader Zacks Retail-Wholesale sector, has yet to report results for the quarter ended January 2022. Results are expected to be released on March 17.
This footwear and accessories retailer is expected to post quarterly earnings of $0.14 per share in its upcoming report, representing a year-over-year change of +126.4%. The consensus EPS estimate for the quarter has been revised down 8.2% in the past 30 days from the current level.
Designer Brands revenue is expected to be $842.88 million, up 38.3% from the prior year quarter.
Zacks names ‘only one best choice for doubling up’
From thousands of stocks, 5 Zacks experts have each picked their favorite to skyrocket by +100% or more in the coming months. Of these 5, Research Director Sheraz Mian selects one to have the most explosive advantage of all.
It’s a little-known chemical company that’s up 65% year-on-year, but still very cheap. With relentless demand, rising earnings estimates for 2022 and $1.5 billion for stock buybacks, retail investors could step in at any time.
This company could rival or surpass other recent Zacks stocks which are expected to double, such as Boston Beer Company which jumped +143.0% in just over 9 months and NVIDIA which jumped +175.9% in one. year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.