Wayfair Poised for 'Strong' Q1 Results, Middle East Uncertainty Likely To Remain Overhang, RBC Says

MT Newswires Live04-24

Wayfair (W) is expected to show "strong" Q1 results, when the company reports its quarterly earnings on Thursday, while the ongoing Iran war remains an overhang on the company's stock, RBC Capital Markets said in a Friday note.

RBC maintained its Q1 net sales growth estimate of 5.7%, in-line with consensus, and said that transaction and site traffic data improved throughout the quarter from the negative impact of Winter Storm Fern in late January.

The company's Q1 gross margin could see some volatility from the rise of crude oil prices due to the war in the Middle East, and its expenses could rise from outsourced labor costs driven by the tech restructuring last year, according to the note.

Looking at the ongoing Q2, RBC said that Wayfair's management is expected to guide top-line for the quarter in the low-single digits to mid-single digits as consumers digest category inflation and higher gas prices potentially limit discretionary sales.

RBC maintained its sector perform rating with a $92 price target.

Price: 78.99, Change: +2.05, Percent Change: +2.66

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