Will Conns (CONN) Continue Its Dismal Trend In Q1 Earnings?
Zacks Investment Research | May 31, 2016 06:45AM ET
Conns Inc. (NASDAQ:CONN) is slated to release first-quarter fiscal 2017 results on Jun 2. Last quarter, the company had delivered a significant negative earnings surprise of 59.3%. In fact, it has underperformed the Zacks Consensus Estimate by an average of 36.5% over the trailing four quarters. Let’s see how things are shaping up for this announcement.
Factors Influencing this Quarter
Conns has posted lower-than-expected earnings for two straight quarters now, reflecting softness in comparable store sales (comps) and high year-over-year delinquencies.
The company recently reported sales and delinquency data for the month and first quarter ended Apr 2016, with comps declining 1.9% and 3.4%, respectively. On excluding the impact of Conns’ decision to discontinue the sale of video game products, digital cameras and certain tablets, comps for April remained flat while dropping 1.3% for the quarter. Moreover, the greater than 60-day delinquency rate expanded by 20 basis points year over year, as of Apr 30, 2016, on account of persistent deceleration in portfolio growth rate. Hence, we remain cautious about the company’s performance in the to-be-reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Conns is likely to beat estimates this quarter. This is because a stock needs to have both a positive Zacks Investment Research
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