Place chart

What does The Children’s Place (PLCE) Q1 revenue have in store for us?

Children’s Place, Inc. PLCE is likely to witness a drop in turnover when it reports first quarter of fiscal 2022 figures on May 19, before the market opened. Zacks’ consensus estimate for revenue is pegged at $406 million, suggesting a 6.8% decline from the figure reported the previous year.

Zacks’ consensus estimate for quarterly earnings per share has been flat at $1.66 over the past 30 days. That suggests a steep decline from the $3.25 reported revenue a year ago. The specialty children’s apparel retailer’s bottom line has exceeded Zacks’ consensus estimate for the past four quarters.

Key Factors to Note

In its last earnings call, management had guided a mid-to-high single-digit decline in first-quarter fiscal 2022 net sales. uncertainty surrounding soaring inflation, the impact of permanent store closures since the first quarter of last year, supply chain bottlenecks and the impact of the Omicron variant.

Management had also warned of the high price of cotton for a decade. It expects gross margin to be lower in the first half of fiscal 2022. It had forecast first-quarter SG&A expenses of around $112 million, higher than last year, primarily in due to additional investments in brand marketing and the impact of the run-in of temporary store closures in Canada last year. Cumulatively, these probably weighed on the net result for the quarter to be published.

Despite the aforementioned headwinds, we cannot ignore the company’s efforts to mitigate these challenges. The company accelerated the fleet optimization initiative, directed resources to digital platforms and took pricing action to offset higher raw material costs. She focused on the “Superior Product” strategy to resonate with millennial customers and advance omnichannel capabilities.

The Children’s Place, Inc. Price, Consensus, and EPS Surprise

The Children’s Place, Inc. price-consensus-eps-surprise-chart | Quote from The Children’s Place, Inc.

What the Zacks Model Reveals

Our proven model does not conclusively predict an earnings beat for The Children’s Place this time around. The combination of a positive ESP Earnings and a Zacks rank of #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of beating earnings. But it is not the case here. You can discover the best stocks to buy or sell before they’re flagged with our Income ESP Filter.

The Children’s Place has an ESP on earnings of 0.00% and a Zacks rank of #1. You can see the full list of today’s Zacks #1 Rank stocks here.

3 actions with a favorable combination

Here are a few companies you might want to consider, as our model shows that they have the right combination of elements to show a pace of profit:

Costco COST currently has a +1.90% Earnings ESP and Zacks Rank #2. The company will likely see improved results when it reports third-quarter fiscal 2022 numbers. Zacks’ consensus estimate for quarterly earnings per share of $3.04 suggests a 10.6% increase compared to the figure reported a year ago.

Costco’s revenue is expected to grow year over year. Zacks’ consensus estimate for quarterly revenue is pegged at $51.76 billion, indicating a 14.3% improvement over the figure reported in the year-ago quarter. COST has a surprise on earnings for the last four quarters of 13.3% on average.

Ross Stores ROST currently has a +1.24% Earnings ESP and a #2 Zacks Rank. The company will likely see lower earnings when it reports fiscal 2022 first-quarter numbers. Zacks’ consensus estimate for quarterly earnings per share of 99 cents suggests a decline from $1.34 compared to the quarter of the previous year.

Ross Stores’ turnover is expected to increase year on year. Zacks’ consensus estimate for quarterly revenue is pegged at $4.54 billion, indicating a marginal improvement of 0.5% over the figure reported in the year-ago quarter. ROST has a surprise on earnings for the last four quarters of 33.3% on average.

Casey General Stores CASY currently has a +3.73% Earnings ESP and a #3 Zacks Rank. The company will likely see an increase in net income when it releases fourth-quarter fiscal 2022 numbers. Zacks’ consensus estimate for quarterly earnings per share of $1.48 suggests an increase of 32.1 % compared to the figure declared a year ago.

Casey’s revenue is expected to increase year over year. Zacks’ consensus estimate for quarterly revenue is pegged at $3.34 billion, suggesting a 40.4% increase from the year-ago quarter. CASY has a four-quarter earnings surprise of 21.6%, on average.

Stay up to date with upcoming results announcements with the Zacks Earnings Schedule.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.