WGO, ACN, FDS, CCL, KMX: Earnings Preview

By Kirsteen Mackay

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Company earnings reports this week include Winnebago Industries (WGO), Accenture (ACN), FactSet Research Systems (FDS), Carnival (CCL), and CarMax (KMX).

US stocks look set to open higher this week after recession fears sent the markets plummeting in recent weeks. Inflation and barriers to growth continue to weigh on investor sentiment, but deeply oversold conditions are expected to keep stocks buoyant in the short term.

Investors look to earnings for clues about how well businesses are navigating this difficult time.

Here is a selection of stocks to watch for earnings updates this week:

Winnebago Industries (NYSE: WGO)

Leisure travel company Winnebago Industries (NYSE: WGO) schedules its Q3 2022 earnings release for 22 June 2022 before the market opens.

The WGO share price more than doubled in 2019. It then plummeted when COVID-19 hit and made a spectacular recovery by June 2020. It then fell back, only to enjoy a revival and achieve new highs in early 2021. Since then, it’s been on a downward trajectory losing more than half its gains.

Despite the falling share price, WGO’s earnings have increased during the past eight quarters.

WGO stock has a price-to-earnings ratio (P/E) of 4.5, and FactSet analysts give it an Overweight rating.

Consensus estimates for Q3 show EPS at $2.96, and sales are rising once more to $1.2bn.

Inflation remains a headwind as component and material costs rise, but the company is prepared to raise prices to preserve its margins. 

Outdoor recreation and leisure time increased massively during the COVID-19 period leading to an uptick in demand for RVs, motorhomes, and powerboats.

Company brands include Winnebago, Grand Design, Chris-Craft, Newmar and Barletta.

Rising fuel costs could put consumers off domestic leisure travel and may reduce demand for Winnebago’s products. 

In 2019, the company established Winnebago Industries Advanced Technology Group (ATG). This division aims to identify suitable electrification technologies for its products and services.

Its first public offering, the e-RV, is an all-electric, zero-emission motorhome. The e-RV just completed a 1,380-mile All-Electric RV Road Trip. The total drive time was 26 hours at an average speed of 53mph.

The WGO share price is down more than 40% year-to-date.

Accenture (NYSE: ACN)

Accenture (NYSE: ACN) is an Irish company providing management consulting, technology, and outsourcing services. ACN helps companies navigate periods of change. The company will host a conference call before the market opens on Thursday, June 23, to discuss its Q3 fiscal year 2022 financial results. A news release containing these results will be issued before the call.

Accenture is at the cutting edge of new technologies so that it can help companies pivot and transition. This means ACN is heavily involved in themes such as the metaverse and decarbonization. Overall, this awareness gives the company an advantage during an economic downturn.

FactSet consensus estimates give ACN stock an EPS of $2.86 with sales rising to $16.03bn.

Last quarter the company experienced double-digit growth in all parts of its business across all markets, industries, and services.

The ACN P/E is 27.8, and it offers a 1.4% dividend yield.

FactSet Research Systems (NYSE: FDS)

FactSet Research Systems (NYSE: FDS) provides integrated financial information, analytical applications and services for the investment and corporate communities.

The company reports its Q3 earnings results on 23 Jun 2022. FactSet analyst EPS consensus is $3.22, and sales consensus is $476.98m for the quarter.

FDS stock has a P/E of 32 and a dividend yield of 1%.

FactSet was recently named the 2022 Financial Services Industry Partner of the Year by data cloud company Snowflake (NYSE: SNOW).

Carnival Corp (NYSE: CCL)

Carnival Corp (NYSE: CCL) is the world’s largest leisure travel company. CCL stock was hit hard by the pandemic as global travel ground to a halt, and cruise ships became widely associated with COVID-19 outbreaks.

CCL stock has not retraced its pre-pandemic highs, which were north of $50 and remain below $10. Year-to-date, the CCL share price is down 55.16%.

The company is set to report its fiscal Q2 earnings results on 23 Jun 2022. FactSet analyst EPS consensus is -$1.18, and sales consensus is $2.75bn for the quarter. Analysts have a Hold rating on the stock.

Carnival does not offer a dividend to shareholders.

Sales fell considerably during COVID-19 but are now showing signs of recovery. However, debt has also increased dramatically during the past two years.

CarMax (NYSE: KMX)

CarMax (NYSE: KMX) is due to report its fiscal Q1 earnings before the market opens on June 24, 2022. It will host a conference call with investors at 9 am ET to discuss these results. 

CarMax, Inc. is a used car dealership selling both retail and wholesale cars.

KMX stock has a P/E of 12.5 and a price-to-sales ratio of 0.5. It does not offer a dividend. FactSet consensus estimates for Q1 show EPS of $1.55 and sales of $9.2bn.

Meanwhile, FactSet analysts have an Overweight rating on the stock and a target share price of $111.43.

The car industry has been shaken since the pandemic hit. Supply chain disruption, near-record low inventory levels, and production delays all contribute to soaring car prices. This has boosted used car sales which have also seen dramatic price hikes.

How much longer this can continue is debatable, particularly with fuel costs soaring.

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Topics:
Quarterly Earnings
Industries:
Consumer Discretionary
Information Technology
Companies:
Carnival
Winnebago Industries
Accenture
FactSet Research Systems
CarMax

Author: Kirsteen Mackay

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

Kirsteen Mackay does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.

Kirsteen Mackay has not been paid to produce this piece by the company or companies mentioned above.

Digitonic Ltd, the owner of ValueTheMarkets.com, does not hold a position or positions in the stock(s) and/or financial instrument(s) mentioned in the above article.

Digitonic Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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