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Precision Castparts Inc.(PCP - Analyst Report) is set to report second-quarter fiscal 2014 results on Oct 24. Last quarter it posted a -0.69% surprise. Let’s see how things are shaping up for this announcement.

Factors this Past Quarter

Precision Castparts gained from strong acquisitions and solid growth in the aerospace segment. During the first quarter, the company reported improved results on the back of increased demand in commercial aerospace and favourable oil and gas businesses.

Two of the three reporting segments posted double digit revenue growth during the quarter. Furthermore, IGT is showing good momentum in its aftermarket backlog as the company is shipping out large quantities of nickel-based, severe-service tubular product over the upcoming four quarters. The company expects its major end-markets to drive organic growth.

Earnings Whispers?

Our proven model does not conclusively show that Precision Castparts is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Negative Zacks ESP:  This is because the Most Accurate Estimate stands at $2.81 while the Zacks Consensus Estimate is higher at $2.82. That is a difference of -0.36%.

Zacks  Rank #3 (Hold): Precision Castparts Zacks  Rank #3 (Hold) lowers the predictive power of ESP because the Zacks  Rank #3 when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with Zacks #4 and #5 Ranks (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Companhia Siderurgica Nacional (SID - Analyst Report) has Earnings ESP of +166.7% and a Zacks Rank #1 (Strong Buy).

Universal Forest Products Inc. (UFPI - Analyst Report) has Earnings ESP of +17.7% and a Zacks Rank #1 (Strong Buy).

Ingersoll Rand Plc (IR - Analyst Report) has Earnings ESP of +8.70% and a Zacks Rank #2 (Buy).

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