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Fortune Brands Home & Security, Inc. (FBHS - Snapshot Report), the home and security products providing company, is slated to report second-quarter 2014 results on Jul 30, 2014. In the last quarter, it posted a negative surprise of 21.87%. Let’s see how things are shaping up for this announcement.

Factors Affecting This Quarter

Despite headwinds like harsh weather and sluggish new construction activities, Fortune Brands reported a year-over-year improvement in its financial results for the first quarter of 2014. Going ahead, this leading home and security products company believes that it has built an impressive momentum in the last couple of years and is well placed to boost profits in the future.

However, we believe this optimism for the rest of the year could be slightly clouded by second quarter  results, wherein the company’s sales might be hurt by weak traffic and macroeconomic headwinds pertaining to residential remodeling, higher mortgage rates as well as increased housing prices.

Earnings Whispers?

Our proven model does not conclusively show that Fortune Brands is likely to beat earnings this quarter. This 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. This is not the case here as you will see below.

Zacks ESP: Fortune Brands currently has an Earnings ESP of -3.64%. This is because the Most Accurate estimate stands at 53 cents a share, while the Zacks Consensus Estimate is pegged at 55 cents per share.

Zacks Rank #4 (Sell): Fortune Brands’ Zacks Rank #4 when combined with a negative ESP makes an earnings beat unlikely. We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Other Stocks to Consider

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

Avis Budget Group, Inc. (CAR - Analyst Report) has an Earnings ESP of +3.18% and a Zacks Rank #1 (Strong Buy).

Archer Daniels Midland Co. (ADM - Analyst Report) has an Earnings ESP of +5.26% and a Zacks Rank #2 (Buy).

Sotheby’s (BID - Snapshot Report) has an Earnings ESP of +3.47% and a Zacks Rank #2.

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