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What's in the Offing for Air Products (APD) in Q3 Earnings?
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Air Products and Chemicals, Inc. (APD - Free Report) is slated to release third-quarter fiscal 2018 results on Jul 26, before the market opens.
The company reported adjusted earnings per share of $1.71 for the fiscal second quarter, up 20% from a year ago. Earnings surpassed the Zacks Consensus Estimate of $1.68.
Air Products reported net sales of $2,156 million, up 8.9% year over year. The top line missed the consensus mark of $2,190 million.
Air Products surpassed the Zacks Consensus Estimate in the trailing four quarters with an average beat of around 4.2%.
The company’s shares have gained 6.1% in a year’s time, outperforming the industry’s rise of 2.1%
Let’s see how things are shaping up for this announcement.
Factors to Consider
For fiscal 2018, Air Products anticipates adjusted earnings per share in the range of $7.25-$7.40 (up from the prior view of $7.15-$7.35). This reflects an increase of 15-17% from the prior year. The company raised its fiscal 2018 earnings outlook taking expected contributions from the Lu'An syngas project into account. The guidance also includes an expected benefit from a lower tax rate of 20%.
Moreover, the company expects adjusted earnings in the band of $1.80 to $1.85 per share for the fiscal third quarter, up 9-12% year over year. Over the next five years, Air Products expects an investment of at least $13 billion. It also sees capital expenditure of $1.8-$2 billion for fiscal 2018.
The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $2,291 million, projecting a rise of roughly 8% year over year.
The Zacks Consensus Estimate for the Industrial Gases — America segment’s third-quarter revenues is pinned at $972 million, reflecting a 4.5% rise from the year-ago figure. Operating income is also expected to increase 4% year over year and the Zacks Consensus Estimate for the same is pegged at $245 million.
The segment is expected to gain from higher volumes and price increase actions. However, Air Products expects higher maintenance cost in the quarter due to several major plant turnarounds. This may impact overall operating costs as well as margins in this unit.
Air Products’ Industrial Gases — Asia segment’s revenues are expected to increase 18% from the year-ago quarter. The Zacks Consensus Estimate for the same is pegged at $633 million. For this segment, the Zacks Consensus Estimate for third-quarter operating income is at $170 million, reflecting a year-over-year increase of 14%. The company gained from higher volumes and pricing in the second quarter and expects to continue to benefit from the same.
The Zacks Consensus Estimate for revenues at the Industrial Gases — EMEA segment is projected at $523 million, reflecting an estimated rise of 16% year over year. Segment income is also expected to increase 14% year over year as the Zacks Consensus Estimate stands at $107 million. Volume gains and pricing actions are expected to drive results.
The Industrial Gases — Global segment revenues are expected to decline 17% year over year. The Zacks Consensus Estimate is pegged at $156 million for the same. Segment income is expected to fall 35% year over year and the Zacks Consensus Estimate for the same is pegged at $18.17 million.
Air Products’ strong balance sheet and cash flows will allow it to make strong investments over the next few years. In addition, strategic investments in high-return projects, new business deals and acquisitions are expected to drive results in fiscal 2018. Higher expected volumes and pricing along with the company’s productivity actions are also likely to support margins in the to-be-reported quarter.
Air Products and Chemicals, Inc. Price and EPS Surprise
Our proven model does not show that Air Products is likely to beat the Zacks Consensus Estimate this earnings season. 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:
Earnings ESP: Air Products has an Earnings ESP of -0.50%. The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at $1.84. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Air Products carries a Zacks Rank #4 (Sell). Note that stocks with a Zacks Rank #4 or 5 (Strong Sell) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
TimkenSteel Corp. has an Earnings ESP of +4.21% and carries a Zacks Rank #2.
Ingevity Corp. (NGVT - Free Report) has an Earnings ESP of +1.52% and carries a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in the Offing for Air Products (APD) in Q3 Earnings?
Air Products and Chemicals, Inc. (APD - Free Report) is slated to release third-quarter fiscal 2018 results on Jul 26, before the market opens.
The company reported adjusted earnings per share of $1.71 for the fiscal second quarter, up 20% from a year ago. Earnings surpassed the Zacks Consensus Estimate of $1.68.
Air Products reported net sales of $2,156 million, up 8.9% year over year. The top line missed the consensus mark of $2,190 million.
Air Products surpassed the Zacks Consensus Estimate in the trailing four quarters with an average beat of around 4.2%.
The company’s shares have gained 6.1% in a year’s time, outperforming the industry’s rise of 2.1%
Let’s see how things are shaping up for this announcement.
Factors to Consider
For fiscal 2018, Air Products anticipates adjusted earnings per share in the range of $7.25-$7.40 (up from the prior view of $7.15-$7.35). This reflects an increase of 15-17% from the prior year. The company raised its fiscal 2018 earnings outlook taking expected contributions from the Lu'An syngas project into account. The guidance also includes an expected benefit from a lower tax rate of 20%.
Moreover, the company expects adjusted earnings in the band of $1.80 to $1.85 per share for the fiscal third quarter, up 9-12% year over year. Over the next five years, Air Products expects an investment of at least $13 billion. It also sees capital expenditure of $1.8-$2 billion for fiscal 2018.
The Zacks Consensus Estimate for third-quarter revenues is currently pegged at $2,291 million, projecting a rise of roughly 8% year over year.
The Zacks Consensus Estimate for the Industrial Gases — America segment’s third-quarter revenues is pinned at $972 million, reflecting a 4.5% rise from the year-ago figure. Operating income is also expected to increase 4% year over year and the Zacks Consensus Estimate for the same is pegged at $245 million.
The segment is expected to gain from higher volumes and price increase actions. However, Air Products expects higher maintenance cost in the quarter due to several major plant turnarounds. This may impact overall operating costs as well as margins in this unit.
Air Products’ Industrial Gases — Asia segment’s revenues are expected to increase 18% from the year-ago quarter. The Zacks Consensus Estimate for the same is pegged at $633 million. For this segment, the Zacks Consensus Estimate for third-quarter operating income is at $170 million, reflecting a year-over-year increase of 14%. The company gained from higher volumes and pricing in the second quarter and expects to continue to benefit from the same.
The Zacks Consensus Estimate for revenues at the Industrial Gases — EMEA segment is projected at $523 million, reflecting an estimated rise of 16% year over year. Segment income is also expected to increase 14% year over year as the Zacks Consensus Estimate stands at $107 million. Volume gains and pricing actions are expected to drive results.
The Industrial Gases — Global segment revenues are expected to decline 17% year over year. The Zacks Consensus Estimate is pegged at $156 million for the same. Segment income is expected to fall 35% year over year and the Zacks Consensus Estimate for the same is pegged at $18.17 million.
Air Products’ strong balance sheet and cash flows will allow it to make strong investments over the next few years. In addition, strategic investments in high-return projects, new business deals and acquisitions are expected to drive results in fiscal 2018. Higher expected volumes and pricing along with the company’s productivity actions are also likely to support margins in the to-be-reported quarter.
Air Products and Chemicals, Inc. Price and EPS Surprise
Air Products and Chemicals, Inc. Price and EPS Surprise | Air Products and Chemicals, Inc. Quote
Earnings Whispers
Our proven model does not show that Air Products is likely to beat the Zacks Consensus Estimate this earnings season. 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:
Earnings ESP: Air Products has an Earnings ESP of -0.50%. The Zacks Consensus Estimate for fiscal third-quarter earnings is pegged at $1.84. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Air Products carries a Zacks Rank #4 (Sell). Note that stocks with a Zacks Rank #4 or 5 (Strong Sell) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Domtar Corp. has an Earnings ESP of +1.70% and flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
TimkenSteel Corp. has an Earnings ESP of +4.21% and carries a Zacks Rank #2.
Ingevity Corp. (NGVT - Free Report) has an Earnings ESP of +1.52% and carries a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>