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Johnson Controls (JCI) Q4 Earnings: Surprise in the Cards?
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Johnson Controls International plc (JCI - Free Report) is set to report first-quarter 2017 results, before the market opens on Feb 1. In the last quarter, the company posted a positive earnings surprise of 18.63%. Let’s see how things are shaping up for this announcement.
Factors Influencing this Quarter
In fiscal 2017, the company expects to generate strong earnings based on solid operational execution and cost benefits from mergers. Johnson Controls expects adjusted earnings per share in the band of $2.60–$2.75 for fiscal 2017, compared with $2.31 earned in fiscal 2016. This reflects a year-over-year increase of 13–19%. Revenues are expected to increase 2.5% to 4.5% in fiscal 2017. The expected improvement in annual results raises hopes for good quarterly performance for the company.
However, the divestiture of several businesses has been weighing on the company’s revenues and profits. Further, negative foreign currency translation is affecting Johnson Controls’ results. Adjusted net sales declined to $36.9 billion in fiscal 2016 from $37.2 billion in the prior year due to deconsolidation of the company's automotive interiors business and foreign exchange headwinds. This trend may continue in the quarter to be reported.
Earnings Whispers
Our proven model does not conclusively show that Johnson Controls 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. This is not the case here, as you will see below:
Zacks ESP: The Earnings ESP for Johnson Controls is 0.00% because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 51 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Johnson Controls International PLC Price and EPS Surprise
Zacks Rank: Johnson Controls carries a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 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 negative estimate revisions.
Price Performance
Johnson Controls has underperformed the Zacks categorized Industrial Products-Services industry in the last three months. During this period, the company’s share price increased 8.5%, while the industry saw a 12.9% increase. The company completed the spin-off of its Automotive Interiors business into an independent company, Adient. Deconsolidation of this business and negative currency translation have been hurting sales.
Stocks to Consider
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Autoliv Inc. (ALV - Free Report) has an Earnings ESP of +1.63% and a Zacks Rank #3. The company’s fourth-quarter and full-year 2016 financial results are scheduled for release on Feb 2.
American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #3. The company is expected to report fourth-quarter and full-year 2016 financial numbers on Feb 10.
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Johnson Controls (JCI) Q4 Earnings: Surprise in the Cards?
Johnson Controls International plc (JCI - Free Report) is set to report first-quarter 2017 results, before the market opens on Feb 1. In the last quarter, the company posted a positive earnings surprise of 18.63%. Let’s see how things are shaping up for this announcement.
Factors Influencing this Quarter
In fiscal 2017, the company expects to generate strong earnings based on solid operational execution and cost benefits from mergers. Johnson Controls expects adjusted earnings per share in the band of $2.60–$2.75 for fiscal 2017, compared with $2.31 earned in fiscal 2016. This reflects a year-over-year increase of 13–19%. Revenues are expected to increase 2.5% to 4.5% in fiscal 2017. The expected improvement in annual results raises hopes for good quarterly performance for the company.
However, the divestiture of several businesses has been weighing on the company’s revenues and profits. Further, negative foreign currency translation is affecting Johnson Controls’ results. Adjusted net sales declined to $36.9 billion in fiscal 2016 from $37.2 billion in the prior year due to deconsolidation of the company's automotive interiors business and foreign exchange headwinds. This trend may continue in the quarter to be reported.
Earnings Whispers
Our proven model does not conclusively show that Johnson Controls 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. This is not the case here, as you will see below:
Zacks ESP: The Earnings ESP for Johnson Controls is 0.00% because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 51 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Johnson Controls International PLC Price and EPS Surprise
Johnson Controls International PLC Price and EPS Surprise | Johnson Controls International PLC Quote
Zacks Rank: Johnson Controls carries a Zacks Rank #3 which increases the predictive power of ESP. However, the company’s 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 negative estimate revisions.
Price Performance
Johnson Controls has underperformed the Zacks categorized Industrial Products-Services industry in the last three months. During this period, the company’s share price increased 8.5%, while the industry saw a 12.9% increase. The company completed the spin-off of its Automotive Interiors business into an independent company, Adient. Deconsolidation of this business and negative currency translation have been hurting sales.
Stocks to Consider
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:
Wabash National Corporation (WNC - Free Report) has an Earnings ESP of +5.13% and a Zacks Rank #1. The company is slated to report fourth-quarter and full-year 2016 results on Jan 31. You can see the complete list of today’s Zacks #1 Rank stocks here.
Autoliv Inc. (ALV - Free Report) has an Earnings ESP of +1.63% and a Zacks Rank #3. The company’s fourth-quarter and full-year 2016 financial results are scheduled for release on Feb 2.
American Axle & Manufacturing Holdings, Inc. (AXL - Free Report) has an Earnings ESP of +2.94% and a Zacks Rank #3. The company is expected to report fourth-quarter and full-year 2016 financial numbers on Feb 10.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>