Earnings announcements that we had previewed for Wednesday evening and Thursday morning all beat bottom-line expectations and all but one beat on the top line as well. Academy Sports and Outdoor, which was expected to report Thursday morning, announced instead that it will report results before markets open on September 9.

After markets close this afternoon, results are due from three companies we previewed on Tuesday: Bill.com, Peloton and Workday.
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Given the results posted Thursday morning by off-price retailers Dollar General and Dollar Tree, we are including here a preview of another off-price retailer reporting Friday morning. Two more companies we track are reporting results before markets open on Monday.

Big Lots

Discount retailer Big Lots Inc. (NYSE: BIG) has posted a share price gain of about 4% over the past 12 months. In early June, the company’s stock was up more than 35% for the same period. Since then, the stock has dropped 20%. Shares were beaten up Thursday morning, as investors punished the sector for the revenue miss and disappointing guidance from Dollar Tree. Rising costs for goods and transportation remain strong headwinds for these companies.

Of 10 analysts covering the stock, only three rate the shares a Buy or Strong Buy, while five have a Hold rating. At a recent price of around $55.10, the stock’s implied upside based on a median price target of $66 is nearly 20%. At the high price target of $77, the implied upside is nearly 40%.

For the company’s second quarter of fiscal 2022, analysts are expecting revenue of $1.48 billion, which would be down 9.3% sequentially and 9.8% year over year. Analysts are looking for adjusted earnings per share (EPS) of $1.12, or 58% lower sequentially and down nearly 60% year over year. For the full fiscal year, the consensus estimate for EPS is $6.66, a drop of 9.3%, on sales of $6.16 billion, down about 0.6%.

The stock trades at 8.6 times expected 2022 and 2023 EPS and 7.6 times estimated 2024 earnings. The stock’s 52-week trading range is $42.05 to $73.23. Big Lots pays an annual dividend of $1.20 (yield of 2.09%).

Cloudera

Enterprise cloud software maker Cloudera Inc. (NYSE: CLDR) has posted a share price increase of about 34% over the past 12 months. Since June 1, the shares have traded in a narrow range of less than a dollar, since the company agreed to be acquired by private equity firms for an all-cash price of around $5.3 billion. Shareholders will receive $16 in cash for each share they own.
Analysts’ ratings on Cloudera are bunched up at Hold, with a couple of Buy ratings. No surprises there.

Revenue for the second quarter of fiscal 2022 is expected to come in at $226.85 million, up 1.2% sequentially and 5.8% year over year. Adjusted EPS are tabbed at $0.09, down about 22.5% sequentially and a penny lower year over year. For the full fiscal year, EPS are forecast to drop by about 6% to $0.42 on sales of $921.85 million.
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Prior to the announced acquisition, revenue growth was forecast at 9.0% and 8.5% for 2023 and 2024, respectively, while earnings growth was forecast to increase by 19.4% in 2023 and nearly 25% in 2024.

Li Auto

Beijing-based electric vehicle maker Li Auto Inc. (NASDAQ: LI) has posted a share price gain of around 66% over the past 12 months. The shares spiked in late November before, dropping below the breakeven line in early May. Since then, the shares are up about 80%. Another Chinese EV maker, Xpeng, reported a larger-than-expected loss Thursday morning, alongside booming revenue. That’s had a negative effect on Li Auto’s stock in morning trading.

Only four brokerages cover the stock, but they all rate the shares at Buy or Strong Buy. At a price of around $30.25, the upside potential based on a median price target of $40.90 is 35%. At the high price target of $62, the upside potential is 105%. The downside risk here, as with many Chinese stocks, is that the government will step in and change the rules. The auto industry, which employs around 1.5 million people, may be insulated from the most damaging changes because automakers employ so many people and they are beginning to build more vehicles for export.

Li Auto is expected to report second-quarter revenue of $4.41 billion, up 23% sequentially and more than 1,300% higher year over year. The expected loss per share is $0.04, less than the loss per share of $0.06 in the first quarter and the year-ago loss per share of $0.41. For the full fiscal year, analysts are looking for an adjusted loss per share of $0.62 on sales of $20.72 billion.

The stock trades at 433.3 times estimated fiscal 2022 earnings and 97.9 times estimated 2023 earnings. The stock’s 52-week range is $15.02 to $47.70, and Li Auto does not pay a dividend.

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