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Wayfair (W) to Report Q1 Earnings: What's in the Cards?

Wayfair W is set to report first-quarter 2021 results on May 6.

The Zacks Consensus Estimate for first-quarter sales is currently pegged at $3.38 billion, indicating an improvement of 45.2% from the year-ago reported figure.

Further, the consensus mark for earnings is pegged at 27 cents per share, up 8% over the past 30 days and indicating growth of 111.7% from the year-ago reported figure.

Wayfair beat the Zacks Consensus Estimate in all of the trailing four quarters, delivering an earnings surprise of 109.1%, on average.

Wayfair Inc. Price and EPS Surprise

 

Wayfair Inc. price-eps-surprise | Wayfair Inc. Quote

 

Let’s see how things are shaping up for this announcement.

Factors to Watch Out For

Wayfair’s first-quarter top line is expected to have benefited from an increase in online home-furnishing orders despite tough year-over-year comparison. Markedly, the company witnessed significant spike in demand due to the onset of COVID-19 in March last year.

Moreover, Wayfair is expected to have continued to add new customers in the to-be-reported quarter. Net active customers, which jumped 53.7% to 31.2 million in the fourth quarter, are expected to have continued the momentum in first-quarter 2021, driven by ongoing consumer migration to e-commerce.

Further, increasing usage of smartphones for e-commerce transactions amid the ongoing pandemic is expected to have resulted in high traffic and strong sales in the first quarter.

Wayfair’s continued investment is also expected to have aided in expanding its international footprint. Additionally, the company’s growing efforts for expanding house-brand offerings in the United Kingdom and North America are expected to have contributed to first-quarter performance.

Moreover, Wayfair’s gross margin guidance range of 26-28% implies year-over-year expansion. The company had reported gross margin of 24.9% in the year-ago quarter.

Additionally, the bottom line is expected to have benefited from lower operating expenses in the to-be-reported quarter.

What Our Model Indicates

Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.

Wayfair has an Earnings ESP of -20.37% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few companies worth considering as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

Fair Isaac FICO has an Earnings ESP of +15.94% and is #2 Ranked. You can see the complete list of today’s Zacks #1 Rank stocks here.

Chuy’s Holdings CHUY has an Earnings ESP of +9.56% and a Zacks Rank #2.

Nautilus NLS has an Earnings ESP of +15.39% and is #3 Ranked.

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Chuys Holdings, Inc. (CHUY): Free Stock Analysis Report
 
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