Earnings Reports: Nike, Lamb Weston, and Resources Connection

As companies prepare to report earnings, expectations reveal challenges for major players like Nike, Lamb Weston, and Resources Connection. Analysts anticipate significant declines in EPS for these firms, raising questions about their future performance.

Date: 02-10-2024

AI Rating: 4

The report outlines expected earnings for three companies in the S&P 500: Nike, Lamb Weston, and Resources Connection. Each of these firms is projecting a decrease in earnings per share (EPS), which could negatively impact their stock prices.

Nike, Inc. (NKE) is forecasting an EPS of $0.51, which represents a 45.74% decrease compared to the same quarter last year. While Nike has a history of beating earnings expectations, this substantial decline could lead to bearish sentiment among investors. However, the company’s higher Price to Earnings (P/E) ratio of 29.17, compared to the industry average of 22.50, suggests potential for higher earnings growth, balancing some negativity.

Lamb Weston Holdings, Inc. (LW), forecasting an EPS of $0.73, is experiencing a even larger 55.21% decrease compared to a year ago. With recent negative surprises in the last two quarters and a P/E ratio of 14.26 against an industry ratio of 25.20, investors might view this negatively, raising concerns over its profitability relative to peers.

Resources Connection, Inc. (RGP) is expecting an EPS of -$0.07, which is a staggering 150.00% decrease from the same quarter last year. Despite strong past performance where they beat expectations and a high P/E ratio of 21.56 (versus 16.30 industry average), this drastic expected loss could alarm investors significantly.

Overall, the negative growth in EPS across these companies raises concerns among investors. While historical performance and P/E ratios introduce some nuance, the projected declines in earnings may overshadow other factors, possibly leading to a bearish outlook on the respective stocks post-earnings release.

Stocks: NKE LW RGP