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Fitbit Beats Q1 Targets, But Disappoints On Q2 EPS Outlook

Fitbit ( FIT ) late Wednesday smashed Wall Street’s targets for the first quarter, but delivered mixed guidance for the current quarter that disappointed investors. Fitbit stock plunged as much as nearly 12% in after-hours trading following the earnings news release. In Wednesday’s regular session, Fitbit stock dipped a fraction, to 17.10. Fitbit made its IPO last June, pricing shares at 20. The maker of wearable fitness devices earned 10 cents a share excluding items on sales of $505.4 million. Analysts polled by Thomson Reuters expected 3 cents and $444.3 million. On a year-over-year basis, Q1 sales rose 50%. But that’s down from 92% growth in Q4, 168% in Q3 and 253% in Q2. Q1 earnings per share dropped 63% from 27 cents in the year-earlier period. For the current quarter, Fitbit is projecting earnings per share of 8 to 11 cents excluding items on sales of $565 million to $585 million, or $575 million at the midpoint. Wall Street had been modeling for Fitbit to earn 26 cents a share, up 24%, on sales of $531.3 million, up 33%. For the year, Fitbit expects non-GAAP EPS of $1.12 to $1.24 on sales of $2.5 billion to $2.6 billion. Analysts on average were looking for 2016 EPS of $1.13 on sales of $2.46 billion. Fitbit competes in the health-and-fitness wearables market with Apple ( AAPL ), Garmin ( GRMN ), Microsoft ( MSFT ), Under Armour ( UA ) and others. Last week, Fitbit announced a distribution deal Chinese e-commerce website Tmall.com , a unit of Alibaba Group ( BABA ), that could bolster its prospects in China.

Investing Action Plan For Wednesday: Tesla, Fitbit, Priceline, Shale

Here’s your Investing Action plan for Wednesday: What you need to know as an investor for the coming day. Tesla Motors ( TSLA ), Fitbit ( FIT ),  Priceline ( PCLN ), Whole Foods Market ( WFM ) and several shale energy companies report earnings on Wednesday. Investors should also pay attention to U.S. oil inventory and production data as well as economic reports on productivity, service sector activity and jobs. Tesla Motors Luxury electric vehicle maker Tesla Motors will report first-quarter financial results after the market closes Wednesday. The consensus estimate on revenue is $1.59 billion, up 45% year over year. The consensus is for a per-share losses of 58 cents, worse than to loss of 36 cents, as polled by Thomson Reuters. Investors will be looking for management comments on Tesla’s delivery targets, as production of the Model X ramps up. Tesla stock hit a seven-month high of 269.34 earlier this month following upbeat Model 3 preorders. But shares have pulled back, falling 3.9% on the stock market today to 232.32, approaching its 50-day and 200-day moving averages. Mobileye ( MBLY ), which provides advanced driver assistance systems for Tesla and several other automakers, reports Thursday morning. Mobileye stock fell 2% Tuesday. Priceline Priceline is expected to report double-digit Q1 sales and earnings growth when it reports before the market open Wednesday. The consensus is for revenue of $2.12 billion, up 15% year over year, and EPS of $9.65, up 19%. A week ago CEO Darren Huston tendered his resignation over an inappropriate-at-work relationship. Priceline stock fell 0.15% to 1354.64. It’s close to a buy point at 1,361.73. Fitbit Fitbit ( FIT ) reports after the close Wednesday. The consensus is for revenue of $443 million , up 32% year over year but the third quarter in a row of deceleration. EPS is pegged at 3 cents, a plunge from a profit of 27 cents a year ago. The maker of wearable fitness devices beat Wall Street’s sales and earnings targets for the holiday quarter, but its guidance for the current quarter fell well short of expectations. Fitbit stock tumbled 6.5% Tuesday to 17.18. Shares have rallied since late February but are still far below their August 2015 peak of 51.90. Whole Foods Market Whole Foods Market is expected to report fiscal Q2 revenue of $3.75 billion, up 3%, and EPS of 41 cents, down 5%. The stock fell 1% Tuesday. Meanwhile, natural foods products grocery rival  Sprouts Farmers Market ( SFM ) reports earnings Thursday morning. Sprouts slid 3.4%. Shale Earnings While a few shale companies have already reported, some of the leaders are coming up, as crude prices rebound to the highest levels since November. Results will be grim, but investors will be looking to see if shale producers plan to slash capital spending even further, or announce plans to step up drilling. Continental Resources ( CLR ) on Wednesday is expected to report a per-share loss that widens to 37 cents from a 9-cent-loss a year ago. Revenue is seen falling 24.5% to $440 million, marking a fifth straight decline. Carrizo Oil and Gas ( CRZO ) and Noble Energy ( NBL ) will announce quarterly results before the market opens Wednesday. Oil Inventories The Energy Information Administration at 1:30 p.m. ET will release U.S. petroleum inventories and production levels. Supplies are near record highs, but U.S. crude output has been falling as shale companies slash drilling. Late Tuesday the American Petroleum Institute estimated that weekly crude inventories rose by 1.3 million barrels, while gasoline stockpiles slid 1.2 million barrels. Economic Reports Employment: ADP will release its estimate of private-sector payrolls for April, ahead of the Labor Department’s big employment report on Friday. Economists expect ADP to report a gain of 193,000 jobs. Productivity: The Labor Department releases nonfarm productivity figures for Q1. Economists expect a 1.2% annualized decline after Q4’s 2.2% drop. Trade deficit: The Commerce Department releases U.S. trade figures for March. The trade gap likely shrank to $41.4 billion vs. February’s $47.1 billion. Service sector: ISM releases its nonmanufacturing index for April. Economists expect the service-sector gauge to show a reading of 54.7, little changed from the solid gain of 54.5.  

Fitbit Q1 Earnings Preview: What You Need To Know

Fitbit ( FIT ) is due for a health checkup late Wednesday and the prognosis for its first-quarter earnings report is looking favorable. But investors got the jitters on the eve of the company’s Q1 report. Fitbit stock fell 6.5% to 17.18 in heavy volume on the stock market today . Fitbit stock has tumbled more than 40% this year as competition has risen and the pace of growth has slowed. Analysts polled by Thomson Reuters expect the maker of wearable fitness devices to earn 2 cents a share excluding items on sales of $443.1 million. On a year-over-year basis, sales would be up 32% if it meets the consensus forecast. That would be down from 92% growth in Q4, 168% in Q3 and 253% in Q2. Fitbit made its IPO last June, pricing shares at 20. For the current quarter, Wall Street is modeling for Fitbit to earn 26 cents a share, up 24%, on sales of $532.8 million, up 33%. Pacific Crest Securities analyst Brad Erickson on Monday reiterated his sector weight, or hold, rating on Fitbit stock. Erickson expects a “beat-and-raise” quarter from Fitbit, but is cautious based on “longer-term views of poor category user trends, a lack of sensor differentiation and a more limited total addressable market.” In the near term, demand appears relatively healthy for the Fitbit Blaze smart fitness watch and the Alta activity tracker, he said. Fitbit also has stocked the retail channel with Charge HR devices for Mother’s Day sales, he said in a research report. Piper Jaffray analyst Erinn Murphy maintained her neutral rating on Fitbit with a price target of 16. “While data points during the quarter have been positive, with strong Amazon ( AMZN ) trends for the newly launched Alta and Blaze models, we remain on the sidelines behind the second-half weighted earnings (we estimate 70% of earnings lie in 2H) and given the tougher product launch comparisons in 2H,” she said in a report Monday. Mizuho Securities analyst Betty Chen kept her buy rating and price target of 20 on Fitbit stock in a report Monday. “Our recent survey highlights increases in Fitbit ownership as well as planned purchase intent at higher average selling prices,” she said. “Moreover, data indicates increased upgrade intent and attachment rate, with 21% of Fitbit device buyers purchasing at least one additional wristband in the last three months. We believe this bodes well for Fitbit’s long-term growth and margin profile.” Last week, diversified rival Garmin ( GRMN ) said its sales of wearable fitness devices rose 9% year over year in Q1, to $142.4 million, but profit margins declined because of intense competition in the category. Garmin also makes GPS navigation devices for automotive, aviation, marine and outdoor markets. In addition to Fitbit and Garmin, other companies competing in the health-and-fitness wearables sector include Apple ( AAPL ), Jawbone, Microsoft ( MSFT ) and Under Armour ( UA ). RELATED: Fitbit Bolsters China Prospects With E-Commerce Deal