Dollar Tree, Inc. (DLTR), operating discount variety stores, is slated to post fourth-quarter fiscal 2013 earnings results on Feb 26, 2014. In the previous quarter, it reported a negative earnings surprise of -3.3%. Let’s see how things are shaping up for this announcement.
Factors this Past Quarter
During the third quarter of fiscal 2013, the company’s top and bottom lines fell short of Zacks’ expectation. The company remains susceptible to sluggish economic recovery and cautious consumer spending.
Earnings Whispers?
Our proven model does not conclusively show that Dollar Tree is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.
Negative Zacks ESP: Dollar Tree currently has an Earnings ESP (Expected Surprise Prediction) of -1.91%. This is because the Most Accurate estimate stands at $1.03, while the Zacks Consensus Estimate is pegged at $1.05.
Zacks Rank #3 (Hold): Dollar Tree’s Zacks Rank #3 when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with a Zacks Rank #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.
Other Stocks to Consider
Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
priceline.com Incorporated (PCLN), Earnings ESP of +3.18% and a Zacks Rank #2 (Buy).
Susser Holdings Corporation (SUSS), Earnings ESP of +2.38% and a Zacks Rank #2 (Buy).
AutoZone, Inc. (AZO), Earnings ESP of +1.99% and a Zacks Rank #2 (Buy).
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