The market has been unpredictable in 2018, mostly sticking to either side of breakeven. However, plenty of stocks have made big moves, both up and down.
Robotic surgery pioneer Intuitive Surgical (NASDAQ:ISRG) has been a big winner, up 38% since the beginning of the year. Two companies that haven’t been so fortunate are footwear maker Skechers (NYSE:SKX) and flooring retailer Tile Shop Holdings (NASDAQ:TTS), which have fallen 18% and 13% year to date, respectively. Here are some key metrics to watch when these companies report earnings in July.
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Shares of Skechers stepped off a cliff after the company’s earnings report in April, falling more than 26%. The casual shoe purveyor reported a quarterly sales record but disappointed investors with its second-quarter guidance. Skechers forecast year-over-year revenue growth between 9.2% and 11.6%, a far cry from the 16.5% growth it achieved in the first quarter. The company indicated that some international shipments had been pushed into the back half of the year.
Skechers is expected to report the results for its most recent quarter on July 19. Its second-quarter revenue growth and its guidance for the following quarter will be closely scrutinized. Additionally, investors will be looking for assurances that the rescheduled shipments are on track for the second half of the year.
Tile Shop Holdings
This time last year, Tile Shop stock was sitting near a 52-week high. Then the bottom dropped out. Over the past year, the company has released three disappointing financial reports in a row and announced the resignation of its CEO. As a result, the stock has lost more than half of its value.
Tile Shop has scheduled its financial report for July 19 before the market opens. Analysts’ consensus estimates are calling for revenue of $90.93 million and earnings of $0.09 per share. Investors will be looking for any indication that the company can right the ship. One carefully watched metric will be comparable-store sales, as the company has reported year-over-year same-store sales declines of 6.8% and 5.9%, respectively, for the preceding two quarters. This metric will be a key contributor to the company’s success or failure going forward.
Shares of Intuitive Surgical have been on a tear, more than doubling over the past two years. The company has seen meaningful procedure growth as doctors add a growing number of new operations that can be performed on its installed base of da Vinci surgical systems — numbering 4,528 in all.
Procedure growth is the single most important metric for investors, as there are a finite number of procedures that can be performed on a given day. Once that number is exceeded, hospitals typically contract for another system, driving additional growth. The number of procedures also drives recurring revenue in the company’s instruments and services segments.
Intuitive Surgical is expected to report the results of its second quarter on July 19, after the market close. The company’s management is forecasting procedure growth in a range of 12% to 15% for 2018. Any significant deviation from that metric — either up or down — could cause a big share price move.