Retail Earnings: Home Depot And Walmart To Set The Tone

• The big retailers are scheduled to begin to post their quarterly results this coming week.
• Two leading big-box store operators are among the first to step into the earnings spotlight.
• Analysts have somewhat high expectations for the top and bottom line results from both of them.

While most of the Dow Jones Industrial Average components and the other corporate giants have already posted their latest earnings results, it's about that time when the big retailers step forward and begin sharing their most recent quarterly numbers. First thing this holiday-shortened week, two of the biggest, most Amazon-proof retailers step up and sent the tone for the coming retail earnings parade.

For the period when some analysts saw limited upside in Home Depot Inc HD, though it also announced both share buybacks and $1,000 bonuses for its hourly associates, the consensus forecast calls for solid growth on both the top and bottom lines for the three months that ended in January.

Analysts are looking for modest earnings and revenue growth from Walmart Inc WMT, when compared to the results in the same period of last year. During the most recent quarter, the world's largest retailer had a winning holiday season and chose to reward it employees as well.

Home Depot

When this Atlanta-based home improvement superstore operator shares its fiscal fourth-quarter results before the opening bell on Tuesday, the analysts on average predict it will post $1.61 per share in earnings. That would be up from the $1.44 a share profit it reported a year ago. The $23.65 billion in expected revenue would be the lowest figure seen in the past three quarters, although it would be more than 6 percent higher year over year.

The forecast from 98 Estimize respondents is a bit more hopeful. It sees the retailer's earnings per share coming in at $1.66, and their consensus revenue estimate for the most recent period is pegged at $23.76 billion. Along with the Wall Street analysts, Estimize underestimated both top and bottom line results in the previous quarter.

See also: Walmart, Target Are Susquehanna's Top Picks Ahead Of Retail Earnings Season

Walmart

Wall Street's consensus forecast calls for this Arkansas-based company's earnings to have risen by seven cents per share from in the same period of last year to $1.36. Note too that 88 Estimize respondents have a consensus estimate of $1.38 a share for the three months that ended in January. The per-share earnings results beat both Estimize and Wall Street expectations in two of the previous three periods.

Estimize underestimated revenue in the prior quarter as well, and this time the respondents are looking for $135.43 billion. That compares with the $134.8 billion consensus revenue forecast from analysts Wall Street, as well as the $130.94 billion the retailer posted in the year-ago quarter. That also would be the greatest quarterly revenue seen in the past two years. Look for the company to share its fiscal fourth-quarter results first thing Tuesday morning as well.

And Others

Other prominent companies that are predicted to show at least some year-over-year earnings growth when they share their results this week include Apache, Chesapeake Energy, Devon Energy, Duke Energy, First Energy, HollyFrontier, HP, Huntsman, KBR, Medtronic, Newmont Mining, Royal Bank of Canada, Southern Company and Sprouts Farmers Market.

But consensus estimates anticipate shrinking profits from Avis Budget, Energy Transfer Partners, Gannett, Hewlett Packard Enterprise, Hormel Foods and MGM Resorts. And, if the analysts are correct, First Solar and Pandora Media will each post a net loss for the most recent period.

After that, keep an eye out for upcoming quarterly reports from retailers Best Buy, L Brands, Foot Locker, Gap, JC Penney, Kohl's, Lowe's, Macy's, Nordstrom and TJX, as well as from Express Scripts, Frontier Communications, Valeant Pharmaceuticals and many others.

Image Credit: Walmart Corporate from Bentonville, USA (Walmart store exterior) [CC BY 2.0], via Wikimedia Commons