Earnings Preview: Bath & Body Works, Foot Locker, Kohl’s, Peloton

Following the closure of the U.S. markets last Friday, Palo Alto Networks announced their earnings per share (EPS) and revenue, which exceeded expectations. Although revenue fell slightly below the consensus estimate, analysts and investors greatly welcomed the news and caused a 14.8% increase in share prices during Monday's morning trading session.

No financial results were scheduled to be released prior to the opening of markets on Monday morning.

Once the markets shut down on Monday and prior to their reopening on Tuesday, companies like Baidu, Dick's Sporting Goods, Lowe's, Macy's, and Zoom Video are due to disclose their financial outcomes. Additionally, keep an eye out for reports from Toll Brothers and Urban Outfitters later on Tuesday.

Take a glimpse into the anticipated performance of the four mentioned companies as analysts eagerly await their quarterly financial reports, scheduled to be released early Wednesday morning.

Pamper Yourself

In the last year, the stock of Bath & Body Works Inc. (NYSE: BBWI) has decreased by approximately 9.3%, with a decline of over 13% so far this year. The shares were recovering slightly until recently when investors became worried about consumer spending. In May, the company launched a range of products for men, and investors will be interested to know its progress. The expectations for EPS and revenue are not very high, so if they fall short, it could significantly impact the stock.

Out of the 20 analysts who have analyzed this stock, 13 recommend buying or strongly buying it, while the remaining seven suggest holding it. The stock is currently trading at approximately $37.00, and according to the average target price of $48.00, there is a potential increase of around 29.7%. However, if we consider the highest target price of $78.00, the potential upside could reach 110.8%.

Experts predict that the revenue for the second quarter will reach $1.57, showing a 12.6% increase compared to the previous quarter and a 3.1% increase compared to the same quarter last year. The earnings per share (EPS) are expected to be $0.34, marking a 3.1% growth from the previous quarter but a 35.6% decline from the same quarter last year. Looking ahead to the full fiscal year ending in January 2024, analysts estimate that the EPS will be $3.04, representing a 10.7% decrease, with sales projected to reach $7.47 billion, a decline of 1.2%.

Bath & Body Works shares are valued at 12.2 times the projected earnings for 2024. They are also priced at 10.2 times the estimated earnings for 2025, which is $3.61 per share, and 8.7 times the projected earnings for 2026, which is $4.24 per share. The trading range for the past 52 weeks has been between $30.52 and $49.55. The company also offers an annual dividend of $0.80, which equates to a yield of 2.19%. Unfortunately, the total return for shareholders over the past year has been a decline of 6.19%.

Foot Locker, a company that operates stores in malls, has seen its stock price decrease by about 21% in the last year, primarily due to a 33% drop in 2023. If it wasn't for the company's generous dividend, there would probably be even less interest in owning the shares. The second quarter is expected to bring very low profits and a decline in revenue. Whether or not to invest in the company depends on whether the investor believes the stock has reached its lowest point and will start to rise again, or if it still has more to fall. We will find out early on Wednesday.

Out of the 20 financial experts who are analyzing the stock, 15 are refraining from taking a definite opinion and have assigned a Hold rating. On the other hand, there are five analysts who have recommended buying the stock. Considering that the current share price is approximately $25.00, according to the average price target of $29.00, the potential gain stands at 16%. However, if we consider the highest price target of $50.00, the potential gain skyrockets to a whopping 100%.

The projected revenue for the second quarter is estimated to be $1.88 billion, showing a decrease of 2.3% compared to the previous quarter and a decline of 8.7% compared to the same period last year. The adjusted earnings per share (EPS) are predicted to be $0.05, indicating a significant decrease of 93.6% compared to the previous quarter and a decline of 95.5% compared to the same period last year. Looking ahead to the full fiscal year 2024 until January, Foot Locker is expected to report EPS of $2.03, which reflects a decline of 59% compared to the previous fiscal year, along with a decrease in revenue of 7.8% amounting to $8.07 billion.

The stock is currently valued at 12.4 times its projected earnings per share for 2024. It is also trading at 8.6 times its estimated earnings for 2025, which are expected to be $2.92 per share, and at 6.5 times its projected earnings for 2026, which are estimated to be $3.88 per share. Foot Locker's stock price has fluctuated between $24.44 and $47.22 over the past year. Additionally, the company pays an annual dividend of $1.60, resulting in a yield of 6.33%. Furthermore, shareholders have experienced a return of 17.56% over the past year.