The RealReal (REAL) Expected to Beat Earnings Estimates: What to Know Ahead of Q3 Release

The RealReal (REAL) is projected to report a Q3 loss of $0.14 per share, a 55.6% year-over-year decline, on revenues expected to rise 14% to $168.47 million. Despite a recent 8.33% downward revision in the consensus EPS estimate, Zacks' analysis, combining a positive Earnings ESP of +3.70% and a Zacks Rank #3, indicates the online luxury consignment platform is likely to beat its consensus EPS estimate when it reports on November 10, a factor that could significantly influence its near-term stock performance.

Analysis

The RealReal (REAL) is projected to report a Q3 loss of $0.14 per share, marking a 55.6% year-over-year decline, despite anticipated revenue growth of 14% to $168.47 million. The upcoming earnings release on November 10 is critical, as actual results relative to these consensus estimates are a primary driver for near-term stock price movements.

Despite a recent 8.33% downward revision in the consensus EPS estimate over the past 30 days, Zacks' proprietary model indicates a high probability of an earnings beat. The company holds a positive Earnings ESP of +3.70% and a Zacks Rank #3 (Hold), a combination historically associated with a positive surprise approximately 70% of the time. This suggests analysts' most recent assessments are more bullish than the broader consensus.

REAL's historical performance shows it has beaten consensus EPS estimates in two of the last four quarters, including a 13.33% surprise in the prior quarter where it reported a -$0.13 loss against an expected -$0.15. This track record, coupled with the current positive Earnings ESP and Zacks Rank, positions The RealReal as a compelling candidate for an earnings beat.

Key Decisions for Investors

• Investors should closely monitor The RealReal's Q3 earnings release on November 10, as a potential EPS beat, indicated by a +3.70% Earnings ESP and Zacks Rank #3, could drive near-term stock performance.
• While revenue growth is projected at 14%, evaluate management's commentary on the earnings call regarding business conditions and future profitability trends, especially given the expected year-over-year earnings decline.
• Consider the implications of the recent 8.33% downward revision in consensus EPS estimates, balancing it against the strong signal for an earnings beat, to gauge evolving analyst sentiment and potential post-earnings volatility.