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Nautilus (NLS) to Report Q1 Earnings: What's in the Cards?

Nautilus, Inc. NLS is set to report first-quarter 2021 results on May 10, after market close.

The company is likely to see growth in the top and the bottom line when it reports first-quarter 2021 results. In the last reported quarter, its earnings surpassed the Zacks Consensus Estimate by 27.6%. However, revenues missed the consensus mark. Nonetheless, the top and the bottom line surged year over year.

Notably, the company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 259.3%.

Let’s see how things have shaped up prior to this announcement

Q1 Estimates

For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has increased to 51 cents from 43 cents over the past 30 days. The estimated figure indicates an improvement of 537.5% from earnings of 8 cents reported in the year-ago quarter. The consensus mark for revenues stands at $158.1 million, indicating a rise of 68.7% from the prior-year quarter.

Factors to Consider

Nautilus’ first-quarter performance is likely to have benefited from robust demand for its home-fitness equipment, strong execution of operational and supply chain improvements. In the last quarter, the company mentioned that it expects first-quarter 2021 revenues to increase 55% to 75% year over year.

Moreover, strong demand for inhouse fitness products like Schwinn IC4, Bowflex C6, Bowflex Home Gyms and SelectTech, treadmills and ellipticals bodes well.

Notably, the company’s margins are expected to expand owing to fixed costs leverage and reduction in sales and marketing expenses.

The Zacks Consensus Estimate for Net Sales - Direct revenues is pegged at $79 million, indicating a decline of 3.7% from the last reported quarter and 67.6% growth year over year. The consensus estimate for Net Sales – Retail revenues is pegged at $75 million, suggesting a decline of 29.2% sequentially.

However, supply-chain disruptions due to the severe shortage of shipping containers and risks associated with current and potential delays, work stoppages and increased transportation costs driven by global logistics disruptions have probably dented the top line during the quarter.

Moreover, gross margin is expected to have remained flat sequentially on increased logistics costs, higher commodity prices and continued foreign exchange headwinds. Also, elevated operating expenses resulting from higher marketing and investments in JRNY and North Star might have been a deterrent.

Nautilus Group, Inc. The Price and EPS Surprise

Nautilus Group, Inc. The price-eps-surprise | Nautilus Group, Inc. The Quote

What Our Model Indicates

Our proven model predicts an earnings beat for Nautilus this time around. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen.

Earnings ESP: Earnings ESP for Nautilus is +0.66%. You can uncover the beststocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently has a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks With Favorable Combination

Here are some companies in the Zacks Retail and Wholesale sector which according to our model have the right combination of elements to post earnings beat in their respective quarters to be reported.

Abercrombie & Fitch Co. ANF has an Earnings ESP of +22.92% and a Zacks Rank #1.

Big Lots, Inc. BIG has an Earnings ESP of +58.28% and a Zacks Rank #3.

Best Buy Co., Inc. BBY has an Earnings ESP of +16.28% and a Zacks Rank #3.

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Best Buy Co., Inc. (BBY): Free Stock Analysis Report
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Nautilus Group, Inc. The (NLS): Free Stock Analysis Report
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