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Electronic Stocks' Earnings Due on Jan 25: TEL, APH & More
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The fourth-quarter earnings season is underway with results from 63 S&P 500 members or 19.2% of the index’s total market capitalization already out (as of Jan 20).
Per the latest Earnings Preview, total earnings of these index members are up 4.7% year over year on the back of 2.7% higher revenues. Beat ratios are impressive with 66.7% beating earnings estimates and 50.8% coming ahead of revenue expectations.
Notably, earnings and revenue growth numbers are better than the recent quarters and on track to cross the highest level in the last eight quarters. However, positive earnings surprises are tracking low at this stage compared with the past quarters.
Most of the companies that have reported so far belong to the finance sector. Improved results from the space have boosted the aggregate growth picture. However, excluding finance, the growth picture isn't impressive. The energy sector is showing some signs of improvement with earnings growth seen after a prolonged period of decline (eight consecutive quarters).
As far as the technology sector is concerned, earnings are now anticipated to be up 3.6% on 4.3% higher revenues.
Among the technology firms slated to report their quarterly earnings on Jan 25, let’s see what’s ahead for these four electronic stocks:
TE Connectivity Ltd. (TEL - Free Report) , a market leader in the connectivity and sensor business, is slated to release its first-quarter fiscal 2017 results.
According to our model, a company needs the right combination of two key ingredients – a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) – to increase its odds of an earnings surprise.
Consequently, we expect the company to post an earnings beat since it carries a Zacks Rank #2 and an Earnings ESP of +1.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The company’s harsh business applications have been experiencing mid-single-digit growth, bolstering revenues. We believe that stellar traction of harsh environment applications will continue to support the top line and margin growth infirst-quarter 2017. (Read More: TE Connectivity Q1 Earnings: Stock Poised to Beat)
Notably, TE Connectivity's results surpassed the Zacks Consensus Estimate in all the preceding four quarters. It has an average four-quarter positive surprise of 5.56%.
Coming to the share price, TE Connectivity underperformed the Zacks categorized Electronics Miscellaneous Components industry over the last one year. While the industry gained 29.69%, the stock gave a positive return of only 24.04%.
We don’t expect Amphenol Corporation (APH - Free Report) , a leading provider of connectors and interconnecting systems, to post an earnings beat when it reports fourth-quarter 2016 results.
This is because the company has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. We caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
However, Amphenol’s topline is expected to benefit from an improved end-market demand, new product rollouts, and market share gains. Demand remains strong in automotive industrial, mobile networks and military markets. (Read More: Amphenol Q4 Earnings: Stock Likely to Disappoint?)
We note that Amphenol’s results compared favorably with the Zacks Consensus Estimate in each of the last four quarters with an average beat of 5.67%.
Over the past one year, shares of Amphenol Corporation underperformed the Zacks categorized Electronics Connectors industry. While the industry grew 43.86%, the stock returned 42.38%.
Similarly, we don’t expect Teradyne Inc. (TER - Free Report) , a leading provider of automated test equipment, to outperform estimates when it reports fourth-quarter 2016 results. The company has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%.
However, Teradyne’s results compared favorably with the Zacks Consensus Estimate in the last four quarters, with an average positive surprise of 19.26%.
Over the past one year, shares of Teradyne underperformed the Zacks categorized Electronic Testing Equipment industry. While the industry gained 37.42%, the stock added35.24%.
We also don’t expect OSI Systems, Inc. (OSIS - Free Report) , a provider of components, subsystems and end-products based on optical and electromechanical pressure sensor technologies, to beat on earnings when it reports second-quarter fiscal 2017 results. This is because the company has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Notably, OSI Systems results also compared unfavorably with the Zacks Consensus Estimate in the last two quarters, with an average negative surprise of 3.08%.
Coming to the share price, OSI Systems underperformed the Zacks categorized Electronics Miscellaneous Components industry over the last one year. While the industry gained29.69%, the stock declined 6.91%.
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>
Unique Zacks Analysis of Your Chosen Ticker
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Electronic Stocks' Earnings Due on Jan 25: TEL, APH & More
The fourth-quarter earnings season is underway with results from 63 S&P 500 members or 19.2% of the index’s total market capitalization already out (as of Jan 20).
Per the latest Earnings Preview, total earnings of these index members are up 4.7% year over year on the back of 2.7% higher revenues. Beat ratios are impressive with 66.7% beating earnings estimates and 50.8% coming ahead of revenue expectations.
Notably, earnings and revenue growth numbers are better than the recent quarters and on track to cross the highest level in the last eight quarters. However, positive earnings surprises are tracking low at this stage compared with the past quarters.
Most of the companies that have reported so far belong to the finance sector. Improved results from the space have boosted the aggregate growth picture. However, excluding finance, the growth picture isn't impressive. The energy sector is showing some signs of improvement with earnings growth seen after a prolonged period of decline (eight consecutive quarters).
As far as the technology sector is concerned, earnings are now anticipated to be up 3.6% on 4.3% higher revenues.
Among the technology firms slated to report their quarterly earnings on Jan 25, let’s see what’s ahead for these four electronic stocks:
TE Connectivity Ltd. (TEL - Free Report) , a market leader in the connectivity and sensor business, is slated to release its first-quarter fiscal 2017 results.
According to our model, a company needs the right combination of two key ingredients – a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) – to increase its odds of an earnings surprise.
Consequently, we expect the company to post an earnings beat since it carries a Zacks Rank #2 and an Earnings ESP of +1.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The company’s harsh business applications have been experiencing mid-single-digit growth, bolstering revenues. We believe that stellar traction of harsh environment applications will continue to support the top line and margin growth infirst-quarter 2017. (Read More: TE Connectivity Q1 Earnings: Stock Poised to Beat)
Notably, TE Connectivity's results surpassed the Zacks Consensus Estimate in all the preceding four quarters. It has an average four-quarter positive surprise of 5.56%.
Coming to the share price, TE Connectivity underperformed the Zacks categorized Electronics Miscellaneous Components industry over the last one year. While the industry gained 29.69%, the stock gave a positive return of only 24.04%.
TE Connectivity Ltd. Price and EPS Surprise
TE Connectivity Ltd. Price and EPS Surprise | TE Connectivity Ltd. Quote
We don’t expect Amphenol Corporation (APH - Free Report) , a leading provider of connectors and interconnecting systems, to post an earnings beat when it reports fourth-quarter 2016 results.
This is because the company has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%. We caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
However, Amphenol’s topline is expected to benefit from an improved end-market demand, new product rollouts, and market share gains. Demand remains strong in automotive industrial, mobile networks and military markets. (Read More: Amphenol Q4 Earnings: Stock Likely to Disappoint?)
We note that Amphenol’s results compared favorably with the Zacks Consensus Estimate in each of the last four quarters with an average beat of 5.67%.
Over the past one year, shares of Amphenol Corporation underperformed the Zacks categorized Electronics Connectors industry. While the industry grew 43.86%, the stock returned 42.38%.
Amphenol Corporation Price and EPS Surprise
Amphenol Corporation Price and EPS Surprise | Amphenol Corporation Quote
Similarly, we don’t expect Teradyne Inc. (TER - Free Report) , a leading provider of automated test equipment, to outperform estimates when it reports fourth-quarter 2016 results. The company has a Zacks Rank #4 (Sell) and an Earnings ESP of 0.00%.
However, Teradyne’s results compared favorably with the Zacks Consensus Estimate in the last four quarters, with an average positive surprise of 19.26%.
Over the past one year, shares of Teradyne underperformed the Zacks categorized Electronic Testing Equipment industry. While the industry gained 37.42%, the stock added35.24%.
Teradyne, Inc. Price and EPS Surprise
Teradyne, Inc. Price and EPS Surprise | Teradyne, Inc. Quote
We also don’t expect OSI Systems, Inc. (OSIS - Free Report) , a provider of components, subsystems and end-products based on optical and electromechanical pressure sensor technologies, to beat on earnings when it reports second-quarter fiscal 2017 results. This is because the company has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Notably, OSI Systems results also compared unfavorably with the Zacks Consensus Estimate in the last two quarters, with an average negative surprise of 3.08%.
Coming to the share price, OSI Systems underperformed the Zacks categorized Electronics Miscellaneous Components industry over the last one year. While the industry gained29.69%, the stock declined 6.91%.
OSI Systems, Inc. Price and EPS Surprise
OSI Systems, Inc. Price and EPS Surprise | OSI Systems, Inc. Quote
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>