BJ's Wholesale Club Holdings, Inc. BJ is likely to register a marginal decline in the top line when it reports fourth-quarter fiscal 2024 results on March 6 before the opening bell. The Zacks Consensus Estimate for revenues is pegged at $5.35 billion, which indicates a drop of 0.1% from the prior-year reported figure.    

The bottom line of this operator of membership warehouse clubs is expected to decrease year over year. Although the Zacks Consensus Estimate for fourth-quarter earnings per share has risen by a couple of cents to 88 cents over the past seven days, it still suggests a decline of 20.7% from the year-ago quarter.

BJ's Wholesale has a trailing four-quarter earnings surprise of 11.5%, on average. In the last reported quarter, this Marlborough, MA-based company’s bottom line surpassed the Zacks Consensus Estimate by a margin of 29.7%.

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What’s Shaping BJ’s Wholesale’s Upcoming Earnings?

BJ's Wholesale’s focus on simplifying assortments, boosting marketing and merchandising capabilities, expanding into high-demand categories and building an own-brand portfolio is commendable. The company remains committed to enhancing omnichannel capabilities, expediting the opening of new clubs and providing value for customers. These endeavors have been contributing to growth in membership signups and renewals. Our model suggests a 6.3% rise in membership fee income for the quarter under review. 

The fourth quarter is anticipated to reflect the positive impact of BJ's Wholesale's emphasis on better pricing, private-label offerings, merchandise initiatives and digital solutions. The company has been actively expanding its membership base, focusing on attracting and retaining loyal customers through enhanced offerings and upgraded memberships. These factors are expected to have contributed to the top line. We expect merchandise comparable club sales to increase 2.8% for the quarter under review.

However, the quarter may also reveal challenges in the form of cautious consumer spending and potential deleverage in SG&A expenses. We anticipate a 4.2% year-over-year increase in SG&A expenses for the fourth quarter, leading to a deleverage of 80 basis points as a percentage of total revenues. As a result, we foresee an operating margin contraction of 80 basis points.

What the Zacks Model Predicts About BJ

As investors prepare for BJ’s fourth-quarter announcement, the question looms regarding earnings beat or miss. Our proven model predicts that an earnings beat is likely for BJ's Wholesale this time. 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, which is the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

BJ's Wholesale has an Earnings ESP of +4.28% and carries a Zacks Rank #2. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

3 More Stocks With the Favorable Combination

Here are three more companies you may want to consider, as our model shows that these also have the right combination of elements to post an earnings beat this season:

Costco Wholesale Corporation COST currently has an Earnings ESP of +0.14% and a Zacks Rank #2. The Zacks Consensus Estimate for second-quarter fiscal 2025 earnings per share is pegged at $4.09, suggesting 10.2% year-over-year growth.

Costco’s top line is expected to ascend year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $63.2 billion, which indicates an increase of 8.2% from the figure reported in the prior-year quarter. COST has a trailing four-quarter earnings surprise of 2%, on average.

Abercrombie & Fitch ANF has an Earnings ESP of +0.59% and carries a Zacks Rank of 3 at present. ANF is likely to register top-line growth when it reports fourth-quarter fiscal 2024 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $1.56 billion, which suggests 7.6% growth from the figure reported in the year-ago quarter. 

The consensus estimate for Abercrombie & Fitch’s fourth-quarter earnings is pegged at $3.49 per share, which calls for 17.5% growth from the figure reported in the year-ago quarter. ANF delivered an earnings beat of 14.8%, on average, in the trailing four quarters.

Five Below FIVE has an Earnings ESP of +1.45% and currently carries a Zacks Rank of 3. FIVE’s top line is anticipated to advance year over year when it reports fourth-quarter fiscal 2024 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $1.38 billion, which suggests a 2.9% rise from the figure reported in the year-ago quarter. 

The company is expected to register a decline in the bottom line. The consensus estimate for Five Below’s fourth-quarter earnings is pegged at $3.35 per share, down 8.2% from the year-ago quarter. FIVE has a trailing four-quarter earnings surprise of 39%, on average.

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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report

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Costco Wholesale Corporation (COST) : Free Stock Analysis Report

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