Beware these companies reporting next week with downside earnings momentum

Published Fri, Aug 11 20231:37 PM EDTUpdated Fri, Aug 11 20232:11 PM EDT

Next week could be a tough one for some companies slated to report earnings. A slew of retailers are scheduled to post their latest quarterly results, including Walmart and Target. Those reports will give investors clues on the health of the U.S. consumer, especially as the economy tries to avoid entering a recession. Thus far, the earnings season has been stronger than expected. With 91% of S & P 500 companies posting quarterly results, roughly 80% have exceeded Wall Street estimates, according to FactSet data. This week has seen a more mixed bag of reports, however, with Disney exceeding forecasts and Roblox posting a miss. Heading into the new week, however, there are some companies analysts have become more pessimistic on and have cut estimates ahead of their reports. CNBC Pro used FactSet data to screen for companies set to report quarterly results next week that meet the following criteria: Member of the S & P 500 Analyst estimates have been downwardly revised by at least 0.5% over the past three months Estée Lauder has fallen victim to the largest analyst markdown on the list, with average earnings per share estimates falling more than 182% over the past three months. The consensus among analysts calls for a loss of 4 cents per share. EL YTD mountain Estée Lauder YTD Estée Lauder has slipped more than 32% this year. Analysts have also lowered their three-month average price targets 11.2%. The cosmetics giant is slated to report earnings Aug. 18. Retail giant Target has seen a three-month earnings estimate markdown from analysts of 23.3%. Analysts have also lowered their price targets an average of 8.7% over the past three months. Analysts polled by FactSet now forecast adjusted earnings per share of $1.51 for the previous quarter. Target has pulled back more than 12% this year. TGT YTD mountain Target has slipped nearly 18% over the past three months alone, and more than 12% in 2023. The company will report second-quarter results Wednesday. Home improvement giant Home Depot and Walmart also made the list, with average three-month adjusted earnings per share cuts of 6.3% and 0.8%, respectively. Both companies have noted a more cautious consumer due to sticky inflation in past earnings reports. HD YTD mountain Home Depot stock ahs added nearly 5% from the start of the year. Home Depot will report second-quarter results Tuesday, while Walmart reports Thursday. Analysts polled by FactSet forecast adjusted earnings per share of $4.46 for Home Depot and $1.69 for Walmart.