Bassett Furniture (BSET) Expected to Beat Earnings Estimates: What to Know Ahead of Q1 Release

The market expects Bassett Furniture (BSET) to deliver a year-over-year decline in earnings on lower revenues when it reports results for the quarter ended February 2020. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.

The stock might move higher if these key numbers top expectations in the upcoming earnings report. On the other hand, if they miss, the stock may move lower.

While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.

Zacks Consensus Estimate

This furniture seller is expected to post quarterly earnings of $0.02 per share in its upcoming report, which represents a year-over-year change of -83.3%.

Revenues are expected to be $112.95 million, down 6.5% from the year-ago quarter.

Estimate Revisions Trend

The consensus EPS estimate for the quarter has been revised 82.22% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change.

Price, Consensus and EPS Surprise

Earnings Whisper

Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Bassett?

For Bassett, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +366.67%.

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On the other hand, the stock currently carries a Zacks Rank of #3.

So, this combination indicates that Bassett will most likely beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?

Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Bassett would post earnings of $0.16 per share when it actually produced earnings of $0.07, delivering a surprise of -56.25%.

Over the last four quarters, the company has beaten consensus EPS estimates two times.

Bottom Line

An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Bassett appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bassett Furniture Industries, Incorporated (BSET) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research

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Nebraska Furniture Mart Weir’s Rooms To Go and other furniture stores are latest to announce temporary closings

Furniture retailers are among the last batch of stores to close in North Texas in response to local officials' efforts to stop the spread of coronavirus. Some continue to take orders online.

Nebraska Furniture Mart is planning to close at 7 p.m. Friday, and others closed this week.

Competition among furniture stores is pretty fierce, and retailers in this category closely watch what other stores are doing.

For a while, some local furniture stores remained open, believing they fell under the category of essential retailers. Nebraska Furniture Mart had said that the elderly need lift chairs, and refrigerators break, even during pandemics.

But this week stricter local rules went into effect.

"As the situation has continued to evolve, we are making the decision to close our showrooms, confident in our ability to serve our customers online," said Tony Boldt, NFM president, in a letter to customers.

Both the city of Dallas and Dallas County have a shelter-in-place order through until April 29. Grocery stores and pharmacies are exceptions. Restaurants can offer only takeout. Denton County also has ordered residents to stay at home and non-essential businesses to close. The rules in Collin County aren't as strict.

Sunnyland Patio Furniture has been closed since Tuesday. The retailer tried abbreviated hours and appointment-only shopping for a few days.

Stacy Furniture has temporarily closed its stores in Allen and Grapevine and an outlet in Flower Mound until at least March 30, the company said in its website.

Weir's Furniture has temporarily closed its stores in Farmers Branch, Plano and Southlake as of Wednesday.

Twitter: @MariaHalkias

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Woman suspects former roommates of stealing furniture: Brunswick Police Blotter

BRUNSWICK, Ohio

Theft: Magnolia Drive

A woman called police March 15 to report that two of her former roommates had taken more than $1,000 worth of her property without her permission when the three were in the process of moving out of a shared condominium.

The victim said the suspects took two stools and a marble end table between Feb. 29 and March 15. The incident was still under investigation at the time of the report.

Drugs: Center Road

Police responded to Home Depot at 6:27 p.m. March 14 for a report of a suspicious car in the parking lot and possible drug activity.

Police spoke with two women inside the car, who said they were waiting for two men who were inside the store. One of the men reportedly tried to "leave the area on foot" when he came out of the store and saw police. He was stopped and found with suspected methamphetamine, marijuana, drug paraphernalia and a knife.

The man also had two outstanding felony warrants. He was cited for possession of the illegal items and turned over to the Cuyahoga County Sheriff's Department.

Police were able to identify the second man the women referenced, but were unable to locate him.

Identity theft: White Willow Lane

A woman reported being contacted by Synchrony Bank at 1:32 p.m. March 14 about an outstanding balance of $5,400 on a PayPal Credit account opened in her name. The woman said she has never used PayPal Credit and is disputing the charges.

The woman called police when the bank requested that she file a police report. There were no suspects at the time of the report.

Read more news from the Brunswick Sun.

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Some furniture manufacturers suspending operations

PONTOTOC – Thousands of furniture manufacturing employees will be idled in the coming days as the coronavirus continues its march.

On Sunday, Behold Washington CEO Lyle Harris said the company would stop production at least through Friday.

In addition, Southern Motion and Fusion Furniture said they would not open Monday. The companies said results came back positive for one employee on Saturday. He had last been at the Fusion plant Thursday. Southern Motion acquired Fusion last year.

"We have been taking every necessary precaution and following every protocol, including daily sanitizing and disinfecting that is being performed several times a day throughout all key areas of the building," Southern Motion posted on Facebook.

"In order to properly assess the situation and to protect the health and safety of all of our associates, we made the decision to shut down operations on Monday, March 23 at all Southern Furniture Industries' locations (Southern Motion, Fusion Furniture, Cushions to Go, Recline Design, and Premier Foam)," the company said.

The production schedule for the upcoming week and updates will be provided on Monday, it said.

Southern Motion employs some 2,100 people.

At Behold Home, Harris said the shutdown will remain in effect until Friday.

"We will reevaluate the situation on a daily basis and communicate when we will re-pen through our Facebook page and local news outlets. We are in the process of establishing a team that will be working to communicate with our employees and customers," Harris wrote to employees. "My view is that it is only a matter of time before one or multiple cases are diagnosed in our workforce."

Behold Washington employs some 300 people.

Harris said several employees have been tested and are awaiting results and some are experiencing symptoms of the COVID-19 virus. No employee has yet tested positive for COVID-19, he said.

However, he said, "Our company leadership can't sit idly by and wait for the results. In my view, we have a responsibility to each of our valued employees and we have a responsibility to the larger communities in which we live to prevent the spread of this highly contagious virus. We have to stem the spread and social distancing and a proactive work stoppage of non-essential industry is the best and only path at this point."

The plant shutdowns follow Franklin Corp.'s announcement Friday that it was stopping production through March 29 after an employee tested positive.

The company said they it will reevaluate the situation on Friday to decide how is best to proceed. Franklin employs about 900 workers.

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Tupelo Mayor issues order breaking up auction at Tupelo Furniture Market

TUPELO • With COVID-19 continuing to spread throughout the state, Mayor Jason Shelton on Saturday issued a directive to the Tupelo Police Department and the Tupelo Fire Department to break up a large gathering of people at an auction at the Tupelo Furniture Market.

At a recent City Council meeting, city officials said they knew the event was scheduled to take place this weekend, but thought the auction was going to be postponed. Shelton, a second-term Democrat, told the Daily Journal in a telephone interview that the order was given to slow the spread of the novel coronavirus and protect the health of Tupelo citizens.

"There were people from all over Northeast Mississippi," Shelton said.

Shelton said he consulted with some Council members and other city officials before issuing the directive. Representatives from the furniture market did not immediately return a request for comment.

The directive comes after Shelton also issued an executive order on Saturday banning public events and gatherings greater than 50 people from taking place in the city.

Shelton, again, called for more direct action and guidance to come from the state level to address measures to slow the spread of the virus, but said "unfortunately that is just not happening."

"It's just an abdication of leadership at the highest level of the state of Mississippi, and we're just not going to wait any longer in the city of Tupelo," Shelton said. "There will likely be political repercussions. We have a governor who is notorious for payback. I'll take the consequences, whatever it may be, but I'm going to do everything I can to keep our citizens safe."

Shelton's order comes after a Council work session where other Council members expressed a need for increased guidance either from the governor or statewide agencies.

"We're looking for some leadership from the governor and his team because right now we've got all these municipalities making different decisions and some of them mesh and some of them don't, but we need a unified stance here," Ward 6 Councilman Lynn Bryan said. "I think we ought to do it on no uncertain terms and put the ball in their lap, or we're going to keep on having to meet like this every 24 hours and come up with a new approach."

Ward 7 Councilman Willie Jennings said he agreed with Lynn Bryan's statement, and Ward 6 Councilman Mike Bryan also said he wanted more state or federal intervention.

"I wish the state and national levels would go ahead and do a blanket policy across the country," Mike Bryan said. "With that said, we as municipality leaders, we don't need to sit around trying to wait. We've got to take care of our own in our city right now until they do what they're going to do."

A communications officials with the governor's office did not immediately have a response to Shelton's or other city leader's remarks, but said she would speak with the governor for a possible response. 

As of Saturday, Mississippi has 140 total presumptive cases of the virus with cases in many Northeast Mississippi counties such as Lee, Monroe, Lafayette, Lowndes, Marshall, Union and Itawamba Counties. Lee County now stands at five cases, with four new reported on Saturday. 

Shelton said he is meeting with other city and county leaders soon to discuss other restrictive measures to possibly have uniform virus safety measures in place throughout the county.

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Deal to save Levin Furniture stores employees is off

"Two weeks ago, I joyously announced that I had agreed to buy back Levin Furniture and the Pennsylvania Wolf stores out of bankruptcy. Today, I have learned that the parent company of Levin's and Wolf is unwilling to sell to me on the terms of our letter of intent. This is horrible," Levin said in a release.

Former owner comes out of retirement to buy Levin Furniture

Art Van Furniture ends liquidation sale over coronavirus

All Art Van stores are now closed, except for in-store pick-up. (Photo: Ryan Garza, Detroit Free Press)

Newly bankrupt Art Van Furniture is bringing an early end to its liquidation sales because of the coronavirus.

The retailer announced Thursday that it has suspended all sales in all of its stores — effective immediately. The liquidation sale began March 6 and attracted enormous lines of customers. The company filed for Chapter 11 bankruptcy on March 9 and it is an open question whether Art Van stores will ever reopen. 

However, in-store customer pick-up arrangements will continue at Art Van stores through Sunday. 

"We know customers will have questions regarding customer service policies and many other important topics," the company's announcement said. "Our operational teams are working diligently to finalize and document those details, and we will communicate them to you as soon as possible."

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Art Van Furniture closing all stores, liquidation sales start Friday