Back to top

Image: Bigstock

Greif (GEF) to Report Q2 Earnings: What's in the Offing?

Read MoreHide Full Article

Greif, Inc. (GEF - Free Report) is scheduled to release second-quarter fiscal 2019 financial numbers after the closing bell on Jun 5.

Greif reported adjusted earnings per share of 65 cents for first-quarter fiscal 2019, reflecting an improvement of 32.6% year over year despite a drop of 0.9% in revenues to $906 million. While the bottom line beat the Zacks Consensus Estimate, the top line missed the same. Over the trailing four quarters, Greif’s earnings per share surpassed the Zacks Consensus Estimate on two occasions but missed the other two, with an average negative beat of 1.33%.

Greif, Inc. Price and EPS Surprise

 

Let’s see how things are shaping up prior to this announcement.

Key Factors to Consider

In the fiscal second quarter, Greif is poised to gain from its ongoing focus on operational execution, capital discipline, and the Caraustar acquisition. However, elevated transportation costs remain a headwind.

In the Rigid Industrial Packaging & Services, volume weakness was mostly pronounced in Latin America in the first quarter of fiscal 2019 owing to recessionary effect in Argentina and isolated operational challenges in the company’s Brazilian operations. In the Asia Pacific region, volumes were impacted by China’s sluggish economy and mounting trade tensions. The volume environment in Western and Central Europe also remained muted on account of trade uncertainty and weak economic conditions. This is likely to continue in second quarter of fiscal 2019 as well.

Currency exchange rates are anticipated to remain volatile. This is likely to remain a concern for the Rigid Industrial Packaging & Services business segment. Price decline will also negatively impact the segment’s margins in the second quarter of fiscal 2019 before improving in the back half of the year.

The Paper Packaging & Services business segment is likely to exhibit growth in the second quarter of fiscal 2019.

The Zacks Consensus Estimate for earnings per share for the fiscal second quarter 2019 is pegged at 79 cents, indicating an improvement of 3.95% from the year-ago quarter. The Zacks Consensus Estimate for total sales of $1.23 billion for the quarter under review, suggesting growth of 27.5% from the prior-year reported figure.

Share Price Performance

Over the past year, Greif’s shares plunged 38.3% compared with the industry’s decline of 2.3%.

Earnings Whispers

Our proven model shows that Greif is likely to beat estimates this quarter. A stock needs to have both — a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) and a positive Earnings ESP — for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Greif has an Earnings ESP of +3.05% as the Most Accurate Estimate is at 81 cents and the Zacks Consensus Estimate is currently pegged at 79 cents.

Zacks Rank: Greif currently carries a Zacks Rank #3, which, along with an Earnings ESP of 3.05%, which makes us reasonably confident of an earnings beat.

Stocks Poised to Beat Earnings Estimates

Here are some other companies that you may want to consider as our model shows that these too have the right combination of elements to post an earnings beat this quarter:

Ambarella, Inc. (AMBA - Free Report) has an Earnings ESP of +100.00% and a Zacks Rank #3.

American Outdoor Brands Corporation has an Earnings ESP of +9.09% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

CarMax, Inc. (KMX - Free Report) has an Earnings ESP of +2.80% and 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 >>


Unique Zacks Analysis of Your Chosen Ticker


Pick one free report - opportunity may be withdrawn at any time


CarMax, Inc. (KMX) - $25 value - yours FREE >>

Greif, Inc. (GEF) - $25 value - yours FREE >>

Ambarella, Inc. (AMBA) - $25 value - yours FREE >>

Published in