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Rockwell Collins (COL) Q2 Earnings: What Awaits the Stock?
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Aviation electronics maker Rockwell Collins Inc. is slated to report second-quarter fiscal 2017 results on Apr 21, before the opening bell. In the last reported quarter, the company recorded a positive earnings surprise of 4.35%. Moreover, the company beat earnings estimates in all of the trailing four quarters with an average positive surprise of 2.07%.
Let’s see how things are shaping up for this announcement.
Factors at Play
In the defense arena, Trump’s victory in the Presidential race may turn out to be a growth catalyst for Rockwell Collins and other defense majors. The outlook for stocks in this space has improved manifold in recent months, notably with enhanced spending promises made by Trump in his latest “America First” budget.
On Mar 16, 2017, Trump unveiled the Pentagon's fiscal-2018 (FY 2018) budget proposal. The budget worth $639 billion includes a base budget of $574 billion, which reflects $52 billion increase over the FY 2017 current budget of $587 billion. Additionally, he also offered another proposal to increase the current fiscal’s defense budget by $30 billion: $24.9 billion in base budget and $5.1 billion in overseas fund. If the budget gets approved, Rockwell Collins will be a major beneficiary/gainer and it will have a positive impact on the company’s growth.
During the second quarter, the company acquired Pulse.Aero Limited, a UK-based company that specializes in self-service bag drop solutions and airline applications. This acquisition aims to improve Rockwell Collin’s passenger processing services at airports and in airlines. It enabled the company to expand the Information Management Services strategy to support the connected aviation ecosystem. This is expected to have a material impact on the company’s financials in the to-be-reported quarter.
For the quarter, the Zacks Consensus Estimate for earnings reflects a 0.9% year-over-year growth. Revenues, on the other hand, are estimated to be $1.33 billion, translating into 1.5% year-over-year growth.
Earnings Whispers
Our proven model does not conclusively show that Rockwell Collins 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: Rockwell Collins has an Earnings ESP 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.31. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Rockwell Collins’ Zacks Rank #3, when combined with an ESP of 0.00%, makes our surprise prediction difficult for this quarter.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions
Rockwell Collins, Inc. Price, Consensus and EPS Surprise
Leidos Holdings, Inc. (LDOS - Free Report) is scheduled to report first-quarter 2017 results on May 4. The company has an Earnings ESP of +1.28% and a Zacks Rank #2.
Northrop Grumman Corp. (NOC - Free Report) is expected to report first-quarter 2017 results on Apr 27. The company has an Earnings ESP of +0.35% and a Zacks Rank #2.
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With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
Image: Bigstock
Rockwell Collins (COL) Q2 Earnings: What Awaits the Stock?
Aviation electronics maker Rockwell Collins Inc. is slated to report second-quarter fiscal 2017 results on Apr 21, before the opening bell. In the last reported quarter, the company recorded a positive earnings surprise of 4.35%. Moreover, the company beat earnings estimates in all of the trailing four quarters with an average positive surprise of 2.07%.
Let’s see how things are shaping up for this announcement.
Factors at Play
In the defense arena, Trump’s victory in the Presidential race may turn out to be a growth catalyst for Rockwell Collins and other defense majors. The outlook for stocks in this space has improved manifold in recent months, notably with enhanced spending promises made by Trump in his latest “America First” budget.
On Mar 16, 2017, Trump unveiled the Pentagon's fiscal-2018 (FY 2018) budget proposal. The budget worth $639 billion includes a base budget of $574 billion, which reflects $52 billion increase over the FY 2017 current budget of $587 billion. Additionally, he also offered another proposal to increase the current fiscal’s defense budget by $30 billion: $24.9 billion in base budget and $5.1 billion in overseas fund. If the budget gets approved, Rockwell Collins will be a major beneficiary/gainer and it will have a positive impact on the company’s growth.
During the second quarter, the company acquired Pulse.Aero Limited, a UK-based company that specializes in self-service bag drop solutions and airline applications. This acquisition aims to improve Rockwell Collin’s passenger processing services at airports and in airlines. It enabled the company to expand the Information Management Services strategy to support the connected aviation ecosystem. This is expected to have a material impact on the company’s financials in the to-be-reported quarter.
For the quarter, the Zacks Consensus Estimate for earnings reflects a 0.9% year-over-year growth. Revenues, on the other hand, are estimated to be $1.33 billion, translating into 1.5% year-over-year growth.
Earnings Whispers
Our proven model does not conclusively show that Rockwell Collins 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: Rockwell Collins has an Earnings ESP 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.31. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Rockwell Collins’ Zacks Rank #3, when combined with an ESP of 0.00%, makes our surprise prediction difficult for this quarter.
Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions
Rockwell Collins, Inc. Price, Consensus and EPS Surprise
Rockwell Collins, Inc. Price, Consensus and EPS Surprise | Rockwell Collins, Inc. Quote
Stocks that Warrants a Look
Unlike Rockwell Collins, we see likely earnings beat coming from these industry peers in the to-be-reported quarter:
Lockheed Martin Corp. (LMT - Free Report) is expected to report first-quarter 2017 results on Apr 25. The company has an Earnings ESP of +1.83% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Leidos Holdings, Inc. (LDOS - Free Report) is scheduled to report first-quarter 2017 results on May 4. The company has an Earnings ESP of +1.28% and a Zacks Rank #2.
Northrop Grumman Corp. (NOC - Free Report) is expected to report first-quarter 2017 results on Apr 27. The company has an Earnings ESP of +0.35% and a Zacks Rank #2.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
See This Ticker Free >>