Starbucks, a well-known coffee chain, has been struggling with downward revisions in earnings estimates. With analysts cutting their numbers 43 times in the past three months, the company’s estimated EPS for the current quarter has fallen over 16% to 94 cents a share. Alongside this, the average analyst price target has also decreased by 16.5% in the same time frame. As a result, Starbucks stock has taken a hit, dropping 11.6% in the past three months and more than 21% year-to-date. Despite efforts to attract customers with value deals like the $5 food and beverage combo option, Starbucks is facing challenges heading into its fiscal third-quarter results release on July 25.
Southwest Airlines has also faced significant downward revisions in earnings estimates, with 28 revisions resulting in a 35.1% consensus estimate decline in the past three months. The company’s earnings for the quarter just ended are currently estimated at 52 cents per share. Despite a slight increase of about 2.4% in the past three months, Southwest Airlines stock is down 0.6% year-to-date. Activist investor Elliott Management’s recent announcement to mount a proxy fight over the company’s performance and lack of growth could add further pressure as Southwest releases its second-quarter results on July 25.
Charlotte-based steelmaker Nucor is another company facing challenges in its upcoming earnings report. With a significant cut in second-quarter earnings guidance, the company has seen a total of 21 earnings estimate cuts in the past three months. Nucor’s earnings for the latest quarter are now estimated at $2.53 per share, marking a 30% decline from previous estimates in April. Despite using electric arc furnaces to melt scrap steel and create new steel, Nucor’s stock has dropped about 13.5% in the past three months and more than 4.5% year-to-date. Investors will be closely watching for the company’s results after the market closes on July 22.
In addition to Starbucks, Southwest Airlines, and Nucor, other companies have also caught the attention of investors in the lead-up to their earnings reports. Old Dominion Freight Line saw 35 downward revisions in EPS in the past three months, indicating potential challenges ahead. Meanwhile, Intel Corp. experienced significant changes in EPS estimates, with a dramatic decline of 56.5% and 74% over the past three and six months, respectively. These companies, along with Starbucks, Southwest Airlines, and Nucor, are likely to face scrutiny from investors and analysts as they navigate the upcoming earnings season.
Overall, the upcoming earnings reports from these companies highlight the importance of carefully monitoring financial performance and market trends. With significant downward revisions in earnings estimates and other key indicators, investors may want to exercise caution and stay informed as they evaluate potential opportunities and risks in the market. As these companies prepare to release their financial results, the impact on their stock prices and overall market sentiment will be closely watched to gauge the broader economic landscape and investment implications.