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Industrial Stocks' Aug 10 Earnings Preview: MIDD, ENS & More

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We believe that economic uncertainties in some developed and emerging nations, soft commodity prices and forex woes played spoilsport for industries like Industrial Products in Apr–Jun 2016. However, the impact of such headwinds is subdued compared with the previous quarter. In the U.S., roughly 1% year-over-year decline in industrial production is believed to have impacted industrial machine and tool makers.

As of Aug 5, roughly 95.5% of industrial products stocks in the S&P 500 Group reported results, recording a 1.2% decline in earnings and 4.5% fall in revenue. Considering the prevalent headwinds, earnings for the industrial products stocks in the S&P 500 Group are predicted to decline 4.9%, while revenue will likely fall 5.6%.

What’s in Store for 3 Industrial Stocks, MIDD, ENS, SMED, for Apr–Jun ‘16 Quarter?

Below we discuss briefly the expectations from the upcoming results (April–June quarter) for three industrial stocks:

Middleby Corp. (MIDD - Free Report) : This industrial company is slated to release its second-quarter 2016 results on Aug 10, after the market closes. In the four trailing quarters, the company reported lower-than-expected results in one while recording better-than-expected results in three. Average earnings surprise was a positive 4.02%.

MIDDLEBY CORP Price and EPS Surprise

MIDDLEBY CORP Price and EPS Surprise | MIDDLEBY CORP Quote

Our proven model conclusively shows that Middleby Corp. will disappoint earnings this quarter as it currently carries a Zacks Rank #4 (Sell) and a -0.92% Earnings ESP (the percentage difference between the Most Accurate estimate and the Zacks Consensus Estimate). For a possible earnings beat, the company should have the right combination of two key ingredients – a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold). Over the last 60 days, the Zacks Consensus Estimate for the stock remained unchanged at $1.09 per share.

Note that we caution against stocks with Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

EnerSys (ENS - Free Report) : This industrial company is slated to release its first-quarter fiscal 2017 (ended Jun 2016) results on Aug 10, after the market closes. In the four trailing quarters, the company reported better-than-expected results in two while lagging estimates in the rest. Average earnings surprise was a positive 0.32%.

ENERSYS INC Price and EPS Surprise

ENERSYS INC Price and EPS Surprise | ENERSYS INC Quote

Our proven model does not conclusively show that EnerSys will beat earnings this quarter because it currently carries a Zacks Rank #3 and 0.00% Earnings ESP. Over the last 60 days, the Zacks Consensus Estimate for the stock has remained stable at $1.10 per share.

Sharps Compliance Corp. : The industrial company is anticipated to release its fourth-quarter fiscal 2016 (ended Jun 2016) results on Aug 10, before the market opens. In the trailing four quarters, the company lagged estimates in three, while recording better-than-expected results in one. Average earnings surprise was a negative 101.39%.

SHARPS COMPLIAN Price and EPS Surprise

SHARPS COMPLIAN Price and EPS Surprise | SHARPS COMPLIAN Quote

Our proven model does not conclusively show that Sharps Compliance will beat estimate this quarter because it currently carries a Zacks Rank #3 and a 0.00% Earnings ESP. Over the last 60 days, the Zacks Consensus Estimate for the stock has remained stable at 7 cents per share.

Stay tuned! Check back on our full write-up on earnings release of Middleby and EnerSys.

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