We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Illinois Tool (ITW) To Report Q2 Earnings: What's in Store?
Read MoreHide Full Article
Industrial products and equipment manufacturer Illinois Tool Works Inc. (ITW - Free Report) is set to release second-quarter 2016 results on Jul 20, before the market opens. The Zacks Consensus Estimate is pegged at $1.40.
Illinois Tool Works delivered better-than-expected results over the four trailing quarters, with an average positive earnings surprise of 1.95%. A sneak peek into the last quarter’s results reveals that the company’s earnings of $1.29 per share exceeded the Zacks Consensus Estimate by 2.38%. Let us see how things are shaping up prior to this announcement.
Factors to Influence Q2 Results
The financial performance of Illinois Tool Works is highly correlated to economic conditions as well as industrial production of the U.S. In second-quarter 2016, the country’s industrial output fell roughly 1% year over year. Also, unfavorable foreign currency movements and weak economic conditions in some developed and developing nations were major concerns. We believe such headwinds might have adversely impacted the demand for the company’s products in the quarter.
Offsetting these adversities, we believe Illinois Tool Works is well positioned to reap benefits from its technologically advanced product portfolio and vast clientele. Also, its enterprise initiatives are anticipated to improve margin profile, while inorganic expansion is likely to strengthen businesses in the existing as well as unexplored markets.
For second-quarter 2016, Illinois Tool Works predicts earnings to be within $1.34−$1.44 per share. Organic revenue is expected to be flat to up 2% while operating margin to be roughly 22.5%.
Earnings Whispers
Our proven model does not conclusively show that Illinois Tool Works will be able to pull a surprise this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for a likely earnings beat. That is not the case here as you will see below.
Zacks ESP: Illinois Tool Works has an ESP of 0.00% for second-quarter 2016, with both the Most Accurate Estimate and the Zacks Consensus Estimate pegged at $1.40.
Zacks Rank: Illinois Tool Works’ Zacks Rank #3, when combined with a 0.00% ESP, makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.
Here are some companies in the machinery industry you may want to consider, as they have the right combination of elements to post an earnings beat this quarter, according to our model.
Hubbell Inc. (HUBB - Free Report) , with an Earnings ESP of +0.70% and a Zacks Rank #2.
Ingersoll-Rand Plc (IR - Free Report) , with an Earnings ESP of +0.77% and a Zacks Rank #2.
Caterpillar Inc. (CAT - Free Report) , with an Earnings ESP of +2.08% and a Zacks Rank #3.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Illinois Tool (ITW) To Report Q2 Earnings: What's in Store?
Industrial products and equipment manufacturer Illinois Tool Works Inc. (ITW - Free Report) is set to release second-quarter 2016 results on Jul 20, before the market opens. The Zacks Consensus Estimate is pegged at $1.40.
Illinois Tool Works delivered better-than-expected results over the four trailing quarters, with an average positive earnings surprise of 1.95%. A sneak peek into the last quarter’s results reveals that the company’s earnings of $1.29 per share exceeded the Zacks Consensus Estimate by 2.38%. Let us see how things are shaping up prior to this announcement.
Factors to Influence Q2 Results
The financial performance of Illinois Tool Works is highly correlated to economic conditions as well as industrial production of the U.S. In second-quarter 2016, the country’s industrial output fell roughly 1% year over year. Also, unfavorable foreign currency movements and weak economic conditions in some developed and developing nations were major concerns. We believe such headwinds might have adversely impacted the demand for the company’s products in the quarter.
Offsetting these adversities, we believe Illinois Tool Works is well positioned to reap benefits from its technologically advanced product portfolio and vast clientele. Also, its enterprise initiatives are anticipated to improve margin profile, while inorganic expansion is likely to strengthen businesses in the existing as well as unexplored markets.
For second-quarter 2016, Illinois Tool Works predicts earnings to be within $1.34−$1.44 per share. Organic revenue is expected to be flat to up 2% while operating margin to be roughly 22.5%.
Earnings Whispers
Our proven model does not conclusively show that Illinois Tool Works will be able to pull a surprise this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for a likely earnings beat. That is not the case here as you will see below.
Zacks ESP: Illinois Tool Works has an ESP of 0.00% for second-quarter 2016, with both the Most Accurate Estimate and the Zacks Consensus Estimate pegged at $1.40.
Zacks Rank: Illinois Tool Works’ Zacks Rank #3, when combined with a 0.00% ESP, makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.
ILL TOOL WORKS Price and EPS Surprise
ILL TOOL WORKS Price and EPS Surprise | ILL TOOL WORKS Quote
Stocks to Consider
Here are some companies in the machinery industry you may want to consider, as they have the right combination of elements to post an earnings beat this quarter, according to our model.
Hubbell Inc. (HUBB - Free Report) , with an Earnings ESP of +0.70% and a Zacks Rank #2.
Ingersoll-Rand Plc (IR - Free Report) , with an Earnings ESP of +0.77% and a Zacks Rank #2.
Caterpillar Inc. (CAT - Free Report) , with an Earnings ESP of +2.08% and a Zacks Rank #3.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>