Retail Earnings Expectations: Ascena Vs. Urban Outfitters

• Earnings reports from two apparel retailers will be among highlights this week.
• Wall Street analysts expect earnings declines from both of them.
• However, top-line growth is anticipated from one of them.

The big retailers have reported their latest quarterly results, showing varying degrees of success during the holiday shopping period. This week a number of smaller and second-tier retailers take their turns in the earnings spotlight, including Ascena Retail Group Inc ASNA and Urban Outfitters, Inc. URBN.

The Wall Street consensus forecast calls for the parent of Ann Taylor, Lane Bryant and Dress Barn to have swung to a net loss for the period in which it named a new chairman. Meanwhile, the parent of Anthropologie and Urban Outfitters is expected to post smaller earnings, as it discounted heavily during the holiday push.

Ascena

When this retailer shares its fiscal second-quarter results after the closing bell Monday, analysts on average predict it will post a $0.10 per share net loss. That compares to earnings per share (EPS) of $0.18 in the prior quarter and $0.01 a year ago. And the $1.75 billion in expected revenue would be down about 5 percent year-over-year. Note that EPS fell short of consensus estimates by at least 10 percent in the previous two quarters.

The forecast from seven Estimize respondents is a little more optimistic on the bottom line, with EPS expected to come in at -$0.08. That would be the lowest level in at least two years. Yet the consensus revenue estimate for the three months that ended in January is $1.74 billion. However, Estimize has overestimated the top line in recent quarters.

See also: This Earnings Season Made Netflix The Top Long-Term Internet Pick

Urban Outfitters

In this case, Wall Street's consensus forecast calls for EPS to have slipped from $0.61 in the same period of last year to $0.56. Note that the consensus estimate was $0.64 per share just 60 days ago. The 27 Estimize respondents have a consensus estimate of $0.55 per share for the three months that ended in January. EPS fell short of expectations in the previous period.

Estimize also overestimated revenue in the previous quarter, and this time the respondents are looking for $1.03 billion. That would be up from the $1.01 billion reported in the year-ago quarter, and it also compares with the Wall Street consensus forecast of $1.04 billion. Look for Urban Outfitters to share its fiscal fourth-quarter results late on Tuesday.

And Others

Also this week, Wall Street anticipates smaller earnings from Casey's General Stores, Express, Genesco, Hibbett Sports, Kirkland's and Party City. If the analysts are correct, Stein Mart and Tailored Brands each will report a net loss.

However, at least some growth on the bottom line is expected at Citi Trends, Dick's Sporting Goods, Michaels Companies, Signet Jewelers, Ulta Beauty and Zumiez.

The following week, retail earnings reports shrink to a trickle, but keep an eye out for those from Bon-Ton Stores, Christopher & Banks, Dollar General, DSW, Guess?, Tiffany and Tilly's.