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.
Will Masco (MAS) Pull Off a Surprise This Earnings Season?
Read MoreHide Full Article
Masco Corporation (MAS - Free Report) is set to report second-quarter 2016 results on Jul 26, before the market opens.
Last quarter, Masco had posted a positive surprise of 28.0%. In fact, the earnings history of this home improvement and building products company is rather impressive. Masco surpassed estimates in the past four quarters, resulting in an average positive surprise of 16.09%.
Let’s see how things are shaping up for this announcement.
Masco has been witnessing strong demand for its leading products since the past few quarters, as both the repair and remodeling industry as well as the new home construction industry are improving. This trend is expected to continue in the soon-to-be reported quarter.
Masco’s earnings, revenues and margin increased year over year in 2015 and the first quarter 2016. We expect the strong trends in earnings, revenues and margins to continue in the to-be-reported quarter as well.
About 21% of Masco’s sales are generated outside U.S, subjecting the company to the impact of currency translation across the globe. Though the U.S. dollar is getting weaker, the negative impact of unfavorable currency translations is still significant. Masco’s international sales may be dampened in the soon-to-be reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Masco is likely to beat earnings this quarter. This 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 this to happen. But that is not the case here, as you will see below.
Zacks ESP: Masco’s Earnings ESP is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at 42 cents.
Zacks Rank: Though the company’s Zacks Rank #3 increases the predictive power of ESP, Masco’s ESP of 0.00% makes surprise prediction difficult.
Note that 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 negative estimate revisions momentum.
Stocks to Consider
Here are some companies in the broader construction sector that can be considered as our model shows that they have the right combination of elements to post an earnings beat this quarter:
Louisiana-Pacific Corp. (LPX - Free Report) with an Earnings ESP of +4.0% and a Zacks Rank #1
Owens Corning (OC - Free Report) with an Earnings ESP of +9.41% and a Zacks Rank #1
Potlatch Corp. (PCH - Free Report) with an Earnings ESP of +42.86% and a Zacks Rank #2
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 >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Will Masco (MAS) Pull Off a Surprise This Earnings Season?
Masco Corporation (MAS - Free Report) is set to report second-quarter 2016 results on Jul 26, before the market opens.
Last quarter, Masco had posted a positive surprise of 28.0%. In fact, the earnings history of this home improvement and building products company is rather impressive. Masco surpassed estimates in the past four quarters, resulting in an average positive surprise of 16.09%.
Let’s see how things are shaping up for this announcement.
MASCO Price and EPS Surprise
MASCO Price and EPS Surprise | MASCO Quote
Factors to Consider
Masco has been witnessing strong demand for its leading products since the past few quarters, as both the repair and remodeling industry as well as the new home construction industry are improving. This trend is expected to continue in the soon-to-be reported quarter.
Masco’s earnings, revenues and margin increased year over year in 2015 and the first quarter 2016. We expect the strong trends in earnings, revenues and margins to continue in the to-be-reported quarter as well.
About 21% of Masco’s sales are generated outside U.S, subjecting the company to the impact of currency translation across the globe. Though the U.S. dollar is getting weaker, the negative impact of unfavorable currency translations is still significant. Masco’s international sales may be dampened in the soon-to-be reported quarter.
Earnings Whispers
Our proven model does not conclusively show that Masco is likely to beat earnings this quarter. This 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 this to happen. But that is not the case here, as you will see below.
Zacks ESP: Masco’s Earnings ESP is 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate stand at 42 cents.
Zacks Rank: Though the company’s Zacks Rank #3 increases the predictive power of ESP, Masco’s ESP of 0.00% makes surprise prediction difficult.
Note that 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 negative estimate revisions momentum.
Stocks to Consider
Here are some companies in the broader construction sector that can be considered as our model shows that they have the right combination of elements to post an earnings beat this quarter:
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 >>