Earnings playbook: A big week of retail reports lies ahead. Here's what investors need to know

Published Sun, Feb 27 20227:56 AM EST

Sara Salinas @in/saracsalinas @saracsalinas

Riya Bhattacharjee @in/riyabhattacharjee/@loislane28

There are more key retail earnings scattered throughout this week, as well as some notable EV start-ups in Lordstown Motors and Lucid. Target, Kohl's and Nordstrom will be the ones to watch in retail, alongside some notable restaurant and food companies such as Domino's Pizza and recent IPO Sweetgreen. Here's what CNBC is watching this week: Monday Lordstown Motors is set to report quarterly results before the market open and will host an investor call at 8:30 a.m. ET. Last quarter: RIDE delayed the commercial production of its Endurance EV pickup due to supplier issues. This quarter: Wall Street is forecasting another quarter of per-share losses and no revenue. What CNBC autos reporter Michael Wayland is watching: "Lordstown Motors, like many SPAC-backed electric vehicle start-ups, has been problematic for investors. The company appears to be on a better track now following a partnership with iPhone maker Foxconn announced in November. The contract manufacturer confirmed plans last month to begin shipping Lordstown Motors Endurance pickups from a factory in Ohio during the second half of this year. Investors will be watching for any further confirmation of those plans as well as updates regarding inquiries from the U.S. Securities and Exchange Commission." What history shows: In Lordstown's three quarters reporting earnings, the stock has fallen in next-day trading twice, including one drop of more than 17%, according to Bespoke Investment Group. Lucid Group is due to release results after the market close, with an investor call for 5:30 p.m. ET. Last quarter: LCID confirmed new reservations and 2022 vehicle production. This quarter: The Street is predicting another quarter of per-share losses. What CNBC autos reporter Michael Wayland is watching: "Lucid Motors is unique among SPAC-backed electric vehicle start-ups in that it's actually producing vehicles for consumers. Investors will be focused on how many Lucid Air sedans the company was able to deliver in 2021. They'll also be looking for the company to confirm a production target of 20,000 vehicles this year and updates on inquiries from the U.S. Securities and Exchange Commission." What history shows: Lucid shares soared nearly 24% after the company's first quarterly report as a public company. Tuesday Target will report earnings at 6:30 a.m. ET and host a call with executives at 9 a.m. Last quarter: TGT topped earnings estimates and said it was focusing on keeping customer prices low. This quarter: Wall Street is forecasting modest EPS and revenue growth year over year. What CNBC retail reporter Melissa Repko is watching: "Target's fourth quarter likely got a boost from the holiday season, as Americans spent a record amount at retailers in November and December . Now, the cheap chic retailer must show it can compete for consumers' time and money, as people juggle other spending priorities in a reopening world and feel the sting of inflation. Target is expected to lay out more details of its strategy at an investor day on Tuesday in New York City." What history shows: Target stock ekes out a small gain on average the day after an earnings report, but it has fallen in next-day trading for 3 of the last 4 quarters, according to Bespoke. Kohl's is set to report results at 7 a.m. ET, followed by an analyst call at 9 a.m. Last quarter: KSS reported a 16% increase in sales as shoppers bought clothes and makeup. This quarter: Analysts are looking for earnings to nearly double year over year. What CNBC retail reporter Lauren Thomas is watching: "Analysts and investors know that Kohl's has a lot of ground to cover as it reports Q4 results. The department store chain has been in a back-and-forth battle with multiple activist investors that have urged Kohl's to consider selling itself . In early February, activist Macellum ramped up pressure on Kohl's as it sought to take control of the retailer's board by nominating 10 directors. Kohl's has argued that its turnaround efforts are resulting in progress. On Tuesday, the retailer will likely be addressing the challenges head on, while also touching on inflation and ongoing supply chain backlogs." What history shows: Shares of Kohl's have posted sizable gains after a quarterly report for each of the last quarters, according to Bespoke. Domino's Pizza should release earnings around 7:30 a.m. ET, with an investor call set for 10 a.m. Last quarter: DPZ revenue fell short of estimates as the pizza chain said staffing troubles and the lack of stimulus checks hurt its U.S. sales . This quarter: Wall Street is expecting earnings growth of roughly 11% year over year. What CNBC restaurants reporter Amelia Lucas is watching: "Last quarter, Domino's snapped its longtime streak for U.S. same-store sales growth. Investors will be watching to see if that happens again as the company laps strong 2020 demand and labor challenges stick around. On top of that, the pizza chain already said in January that it's expecting 'unprecedented' increases to food costs in 2022, which will likely weigh on its earnings." What history shows: The fourth quarter is the strongest for Domino's stock, with shares gaining an average of 2.9% after a Q4 report, according to Bespoke. Salesforce is set to report earnings shortly after the end of trading, followed by an investor call at 5 p.m. ET. Last quarter: CRM 's fourth-quarter guidance missed expectations , and the company named Bret Taylor to be co-CEO. This quarter: Analysts are projecting EPS to come in almost 30% below last year's levels. What CNBC technology reporter Jordan Novet is watching: "Enterprise software maker Salesforce has fallen more than the iShares Expanded Tech-Software Sector ETF since the start of this year as investors have opted for safer investments to prepare for higher interest rates. Analysts expect revenue growth to slow to 24%, and some expect acquisitions Salesforce completed in recent years to limit the company's upside. Team chat app Slack doesn't appear to gaining extensive traction, while in November executives pointed to 'scaling challenges' at integration software subsidiary MuleSoft, an issue that might be ongoing." What history shows: Salesforce stock usually advances after an earnings report, according to Bespoke, but last quarter it shed more than 11% in next-day trading. Nordstrom is due to report its quarterly results just after market close, with an analyst call set for 4:45 p.m. ET. Last quarter: JWN 's earnings fell short of analysts' expectations as labor costs ate into profits. This quarter: Analysts are expecting a big earnings upside over the same quarter in the prior year. What CNBC retail reporter Lauren Thomas is watching: "After a disappointing Q3, investors hope to see that trends online and in stores improved over the holiday season. The retailer's off-price business was the weak spot in the third quarter, with revenue not yet returning to pre-pandemic levels. Overall, analysts say Nordstrom has had a more difficult time keeping its inventories aligned with consumer demand during the pandemic. Nordstrom might also be asked to address a report that it has been working with AlixPartners to consider a breakup of Rack from its full-line shops." What history shows: Nordstrom shares have lost ground in next-day trading each of the last four quarters, according to Bespoke. Last quarter, the stock shed nearly 30% after its report. The quarter before that, it fell more than 17%. AMC Entertainment will release results around 4:15 p.m. ET and host a call with executives at 5 p.m. Last quarter: AMC posted a narrower-than-expected loss, but the CEO warned of pandemic challenges ahead. This quarter: Wall Street is expecting a massive improvement from the same quarter last year when AMC reported a loss per share of $6.21. What CNBC entertainment reporter Sarah Whitten is watching: "AMC pre-released some financials in early February, so analysts and investors are already aware that the company beat revenue benchmarks during the fourth quarter. What they'll be looking for on Tuesday are details about AMC's future. The company has made strides to pay down and refinance its debt, but retail investors seem more focused on more trendy endeavors like NFTs and cryptocurrency initiatives." What history shows: AMC shares typically come out ahead the day after an earnings release, but they've declined in next-day trading each of the last two quarters, according to Bespoke. Thursday Best Buy is due to report its results at 7 a.m. ET, followed by an investor call at 8 a.m. Last quarter: BBY beat estimates, but shares tumbled amid rising shipping costs and weaker demand for consumer electronics. This quarter: The Street is projecting EPS to come in 20% lower than last year. What CNBC retail reporter Melissa Repko is watching: "For Best Buy, the holiday quarter likely brought elevated sales of tech-based gifts from smartphones to gaming consoles. For investors, though, the bigger questions are about the consumer electronic retailer's future. It is lapping a period when shoppers got extra money from government stimulus and bought pandemic-related home purchases like kitchen appliances, technology for remote work and home theaters. Along with reporting earnings, Best Buy will hold its first investor day since the start of the pandemic. Wall Street will listen for the company's outlook and potential growth levers, including growing its membership program , services business and foray into health care. " What history shows: Best Buy shares have had a tough time of late around quarterly releases, declining in next-day trading 6 of the last 8 quarters, according to Bespoke. Gap should report results around 4:15 p.m. ET, with an analyst call at 5 p.m. ET. Last quarter: GPS saw millions in lost sales from delayed shipments and cut its full-year outlook. This quarter: Analysts are forecasting a quarterly loss per share, compared with a per-share profit during the same quarter a year earlier. What CNBC retail reporter Lauren Thomas is watching: "As Gap reports its fourth-quarter results, all eyes will be on profit margins and how the retailer is handling merchandise markdowns in 2022. The apparel retailer was notorious pre-pandemic for its frequent promotions, which weighed on its overall financials. It pivoted its strategy in 2021 when inventories were tightened due to supply chain obstacles and demand was more constrained. But the fear is that in the coming months Gap, along with its other brands including Old Navy, will resort to old habits. Investors are also looking for any updates around Gap's launch with rapper Kanye West, on a line called Yeezy Gap." What history shows: Gap stock loses an average of 0.8% after a quarterly release, according to Bespoke. Sweetgreen will release its first earnings report as a public company sometime after market close and will host a call with executives at 5 p.m. ET. This quarter: The Street is expecting a quarterly loss per share. What CNBC restaurants reporter Amelia Lucas is watching: "After going public in mid-November, Sweetgreen will make its first report as a publicly traded company. After soaring on its first trading day, the stock has struggled, losing about half of its value. But narrowing its losses and reporting strong digital sales could help turn things around for shares."

Traders on the floor of the NYSE, Feb. 25, 2022.

Source: NYSE

There are more key retail earnings scattered throughout this week, as well as some notable EV start-ups in Lordstown Motors and Lucid.