Flexsteel Gears Up to Report Q1 Earnings: Things to Keep in Mind
Flexsteel Industries, Inc. FLXS is slated to report its first-quarter fiscal 2025 results on Oct. 21, after market close.
In the last reported quarter, the company’s earnings topped the Zacks Consensus Estimate by 11.9% and increased 108.3% year over year. Net sales topped the consensus mark by 1.2% and increased 4.7% from the prior-year quarter’s level.
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FLXS’ bottom line topped the consensus mark in two of the trailing four quarters, met on one occasion and missed once, with an average negative surprise of 2.5%.
Trend in Estimate Revision for FLXS
The Zacks Consensus Estimate for Flexsteel’s fiscal first-quarter earnings has increased to 62 cents from 54 cents in the past 60 days. The estimated figure indicates a 342.9% rise from the year-ago quarter's earnings of 14 cents per share.
Flexsteel Industries, Inc. Price and EPS Surprise
Flexsteel Industries, Inc. price-eps-surprise | Flexsteel Industries, Inc. Quote
The consensus mark for net sales is pegged at $101.7 million, indicating year-over-year growth of 7.5%.
Key Factors to Note for Flexsteel’s Q1 Performance
Despite continued challenging conditions in the industry, Flexsteel’s net sales and earnings are likely to have increased year over year in the fiscal first quarter, driven by strong sales order growth through retail stores. The company's focus on expanding core markets, along with investments in innovation, product development, customer experience and marketing, is likely to have aided its performance in the to-be-reported quarter.
For the fiscal first quarter, the company expects net sales in the range of $100 million and $105 million, reflecting 5% to 10% growth compared with the prior-year quarter’s actual.
Moreover, FLXS' efforts, including leveraging sales growth, cost-saving initiatives and a profitable product mix, are likely to have aided its bottom-line performance in the to-be-reported quarter.
The company expects gross margin to be between 21.5% and 22% in the quarter under review, up from 19.5% reported in the year-ago quarter. FLXS carefully manages SG&A spending while investing in growth initiatives. It anticipates SG&A costs to range between $16.5 million and $17 million for the quarter.
However, the company views weak consumer demand as a major concern. The impact of inflation and high interest rates is expected to weigh on consumer confidence and the housing market, which is a key driver of furniture demand. Also, lower sales in the e-commerce channel, due to softer consumer demand, are likely to have dented the company's performance in the to-be-reported quarter.
What Our Quantitative Model Predicts
Our proven model does not conclusively predict an earnings beat for FLXS this time around. 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, as you will see below.
Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: FLXS currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks Poised to Beat Earnings Estimates
Here are some stocks from the Zacks Consumer Discretionary sector that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat this season.
AMC Entertainment Holdings, Inc. AMC has an Earnings ESP of +84.00% and a Zacks Rank of 2 at present.
AMC is expected to register a 33.3% increase in earnings for the to-be-reported quarter. It reported better-than-expected earnings in two of the trailing four quarters and missed twice, the average negative surprise being 69.5%.
Planet Fitness, Inc. PLNT currently has an Earnings ESP of +6.33% and a Zacks Rank of 2.
PLNT’s earnings topped the consensus mark in each of the trailing four quarters, with the average surprise being 7%. Earnings for the to-be-reported quarter are expected to decrease 1.7% year over year.
Boyd Gaming Corporation BYD currently has an Earnings ESP of +2.53% and a Zacks Rank of 3.
BYD’s earnings for the to-be-reported quarter are expected to increase 3.68%. It reported better-than-expected earnings in two of the trailing four quarters and missed twice, the average surprise being 3.6%.
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Flexsteel Industries, Inc. (FLXS) : Free Stock Analysis Report
AMC Entertainment Holdings, Inc. (AMC) : Free Stock Analysis Report
Planet Fitness, Inc. (PLNT) : Free Stock Analysis Report