- John Marshall of Goldman Sachs identified the 25 most "out-of-consensus opportunities" ahead of earnings season.
- Marshall noted that both call and put buyers benefited from the high volatility and low correlation theme last earnings season.
- Marshall added expectations this earnings season is "low."
Upside To Consensus Estimates
Discretionary Stocks: 1. Chipotle Mexican Grill, Inc. CMG: Upside will come from higher revenues and lower food inflation. 2. Carter's, Inc. CRI: Bullish on the OshKosh segment, direct-to-consumer expansion, and international expansion. 3. Ford Motor Company F: "Sustained" performance from the new F-150 which improves the company's product and pricing mix. 4. Williams-Sonoma, Inc. WSM: Company beginning to see benefits from key gross margin drivers. Energy Stocks: 1.ENSCO PLC ESV: A more efficient and improved expense management could yield earnings upside. 2. Valero Energy Corporation VLO: Company turnaround is "genuine" and "sustainable," despite ongoing skepticism from some investors. Financial Stocks: 1. Public Storage PSA: Underlying fundamentals of storage are "outstanding" and the stock represents the "top opportunity." 2. SunTrust Banks, Inc. STI: Company should report better than expected expenses and lower delinquencies. Healthcare Stocks: 1. Hologic, Inc. HOLX: Investors are still "missing" the underlying momentum in the product cycle, company expected to report better tomo sales this quarter. 2. Laboratory Corp. of America Holdings LH: The company's core lab business is "growing stronger" which creates the potential for continued outperformance. Staples Stocks: 1. General Mills, Inc. GIS: Recent initiatives are beginning to "resonate" with millennials. Technology, Media, Telecom Stocks: 1. Amazon.com, Inc. AMZN: Company continues to accelerate market share gains and margin upside. 2. Ciena Corporation CIEN: Higher packet functionality, software content, and product mix will support a mid-40 percent gross margin rate. 3. LinkedIn Corp LNKD: Growth in Sales Navigator to accelerate, creating a "favorable" risk to reward profile. 4. Visa Inc V: Company should benefit from continued revenue acceleration and a potential update on a business combination with Visa Europe.Downside To Consensus Estimates
Discretionary Stocks: 1. Cabelas Inc CAB: "tough" results will result in a negative estimate revision cycle. 2. Foot Locker, Inc. FL: Recent challenges from peers are "symptomatic of a moderating selling environment" for Foot Locker's higher priced athletic footwear. 3. Genuine Parts Company GPC: The ongoing slowdown seen in the industrial business has been reinforced by "sluggish" monthly data reports by its peers. Industrials Stocks: 1. Emerson Electric Co. EMR: Consensus estimates are "underestimating" the impact of "lower for longer" oil prices on the company's process business. 2. Eaton Corp plc ETN: Street expectations are too high given a "more challenging demand environment. 3. Joy Global Inc. JOY: Company may present 2016 guidance that will fall "well below" consensus estimates. Staples Stocks: 1. Colgate-Palmolive Company CL: Management continues to reduce advertising expenses to "contain" earnings per share "erosion." Technology, Media, Telecom Stocks: 1. Centurylink Inc CTL: Structural concerns about pressures to margins and free cash flow could "compress" the firm's dividends. 2. IAC/InterActiveCorp IACI: Company remains "structurally challenged," further Tinder monetization will be "slower than expected." 3. Infinera Corp. INFN: Continued initiatives and transitions "heighten" near-term revenue risk and margin pressure.© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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Posted In: Analyst ColorEarningsEarningsEarnings Picksearnings seasonGoldman SachsHealth CareHealth Care ServicesJohn MarshalloptionsVolatility
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