Consumer Discretionary Q3 Earnings: Nike (NYSE:NKE) is the Best in the Biz

Looking back on consumer discretionary stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Nike (NYSE:NKE) and its peers.

This sector includes everything from cable TV services to hotel stays to gym memberships. While diverse, the way people buy and experience these products is being upended by the internet and digitization. Consumer discretionary companies are working to adapt to secular trends such as streaming video, online marketplaces for lodging accommodations, and connected fitness. That discretionary purchases are, by definition, something consumers can give up makes it even more imperative for companies in the space to adapt.

The 6 consumer discretionary stocks we track reported a mixed Q3. As a group, revenues missed analysts’ consensus estimates by 1.3%.

Inflation progressed towards the Fed's 2% goal recently, leading the Fed to reduce its policy rate by 50bps (half a percent or 0.5%) in September 2024. This is the first cut in four years. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be debating whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.

While some consumer discretionary stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.8% since the latest earnings results.

Best Q3: Nike (NYSE:NKE)

Originally selling Japanese Onitsuka Tiger sneakers as Blue Ribbon Sports, Nike (NYSE:NKE) is a global titan in athletic footwear, apparel, equipment, and accessories.

Nike reported revenues of $11.59 billion, down 10.4% year on year. This print was in line with analysts’ expectations, and overall, it was a decent quarter for the company: Nike blew past analysts’ EPS expectations. On the other hand, its constant currency revenue declined 9% and unfortunately missed.

Unsurprisingly, the stock is down 5.9% since reporting and currently trades at $83.84.

Is now the time to buy Nike? Access our full analysis of the earnings results here, it’s free.

Scholastic (NASDAQ:SCHL)

Creator of the legendary Scholastic Book Fair, Scholastic (NASDAQ:SCHL) is an international company specializing in children's publishing, education, and media services.

Scholastic reported revenues of $237.2 million, up 3.8% year on year, outperforming analysts’ expectations by 1.6%. The business had a strong quarter with a decent beat of analysts’ earnings estimates.

Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 11.2% since reporting. It currently trades at $26.82.

Is now the time to buy Scholastic? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Matthews (NASDAQ:MATW)

Originally a death care company, Matthews International (NASDAQ:MATW) is a diversified company offering ceremonial services, brand solutions and industrial technologies.

Matthews reported revenues of $427.8 million, down 10.9% year on year, falling short of analysts’ expectations by 10%. It was a disappointing quarter as it posted a miss of analysts’ earnings estimates.

Matthews delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 20.5% since the results and currently trades at $22.30.

Read our full analysis of Matthews’s results here.

Delta Air Lines (NYSE:DAL)

One of the ‘Big Four’ airlines in the US, Delta Air Lines (NYSE:DAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.

Delta Air Lines reported revenues of $15.68 billion, up 1.2% year on year. This number surpassed analysts’ expectations by 2.5%. Taking a step back, it was a satisfactory quarter as it also recorded a solid beat of analysts’ earnings estimates but a miss of analysts’ operating margin estimates.

Delta Air Lines achieved the biggest analyst estimates beat among its peers. The stock is up 9.8% since reporting and currently trades at $55.98.

Read our full, actionable report on Delta Air Lines here, it’s free.

Carnival (NYSE:CCL)

Boasting outrageous amenities like a planetarium on board its ships, Carnival (NYSE:CCL) is one of the world's largest leisure travel companies and a prominent player in the cruise industry.

Carnival reported revenues of $7.90 billion, up 15.2% year on year. This number met analysts’ expectations. It was a satisfactory quarter as it also logged optimistic earnings guidance for the full year.

Carnival scored the fastest revenue growth among its peers. The stock is up 16.2% since reporting and currently trades at $21.55.

Read our full, actionable report on Carnival here, it’s free.

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