Q2 2020 Retail Scorecard – Update August 18, 2020


By Jharonne Martis

Seventy-four percent of companies in our Retail/Restaurant Index have reported Q2 2020 EPS. Of the 153 companies in the index that have reported earnings to date, 78% have reported earnings above analyst expectations, and 22% reported earnings below analyst expectations. The Q2 2020 blended earnings growth estimate is -51.5%.

The Q2 2020 blended revenue growth estimate is -5.0%. Seventy-three percent have reported revenue above analyst expectations, and 27% reported revenue below analyst expectations.

Exhibit 1: Refinitiv Earnings Dashboard

Source: I/B/E/S data from Refinitiv

Retail earnings this week

For Q2, the StarMine SmartEstimate data shows investors can expect positive surprises from both Target (NYSE:TGT) and Lowe’s (NYSE:LOW). Target has an EPS mean forecast of $1.62 a share. However, there’s a five-star rated analyst with a historically accurate rating that published a Bold Estimate, calling for Target to report earnings of $2.04 a share, well above the mean.

The same can be said for Lowe’s. The home improvement retailer currently has an EPS mean forecast of $2.95 a share. However, there’s a five-star rated analyst with a very accurate rating that published a Bold Estimate, which is different (in this case higher) than the consensus estimate. The analyst expects Lowe’s to report earnings of $3.87 a share, almost a dollar above the mean.

Exhibit 2: Same Store Sales and Earnings Estimates/results – Week of Aug. 18, 2020

Source: I/B/E/S data from Refinitiv

Meanwhile, Walmart (NYSE:WMT) beat its Q2 earnings, revenue and SSS estimates. The results are even more impressive when you take into consideration that it’s hired about half a million new employees, and spent about $1.5 billion on costs related to Covid-19. Its e-commerce sales grew 97% and the company is planning on launching Walmart + in order to compete with Amazon Prime (NASDAQ:AMZN).

Exhibit 3: Walmart E-commerce Sales

Source: I/B/E/S data from Refinitiv

Original post

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.

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