RBC Capital analysts provided their outlook on Spectrum Brands Holdings, Inc. (NYSE:SPB) ahead of the company’s upcoming Q2 earnings results, expected to be announced on Friday.

The analysts estimate adjusted EPS of $0.45 in Q2 and adjusted EBITDA of $83 million, slightly below the Street estimate of $85 million. Since the company’s Q1 results announcement, the challenges of the macro environment have worsened, particularly input and transportation costs, but also some demand softness. The analysts believe the company to likely use this quarter as an opportunity to lower guidance given increasing uncertainty around elements of both supply and demand.

The analysts are modeling meaningful margin contraction across all segments. They expect management will be able to reaffirm the revenue guidance, driven by pricing. But given the company’s penchant for guiding conservatively, the analysts believe it would be best to use the volatility of the environment as the right time to lower guidance on margin.