Trimble Navigation (TRMB - Free Report) is slated to report fourth-quarter 2016 results on Feb 8. In the last-reported quarter, Trimble Navigation recorded a positive earnings surprise of 7.41%.
Over the past one year, shares of Trimble Navigation outperformed the Zacks categorized Electronic Products Miscellaneous industry. While the industry gained 32.18%, the stock returned 57.07%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Trimble posted decent third-quarter 2016 results with the bottom line surpassing the Zacks Consensus Estimate and the top line missing the same. Earnings were backed by solid expense management.
Pro forma gross margin was also up sequentially driven by a favorable mix of products in some businesses.
The company’s Mobile Solutions segment may have continued to benefit from growth in Transportation and Logistics, and is likely to show improvement in the upcoming release. Also, Trimble is watching out for trends in the E&C market to improve from the building construction, and civil engineering and construction businesses. Moreover, its initiatives toward lowering the cost structure will continue to drive gross margins.
However, increasing competition and deferred revenue accounting effects could impact the results.
For the fourth quarter, management expects revenues in the $562–$592 million. The Zacks Consensus Estimate is pegged at $578.2 million. Non-GAAP earnings per share from continuing operations are likely to be in the range of 27–32 cents. GAAP earnings are expected in the range of 11–16 cents.
Earnings Whispers
Our proven model does not conclusively show that Trimble will beat estimates 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. That is not the case here, as you will see below.
Zacks ESP:Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 26 cents. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Trimble currently has a Zacks Rank #3 which increases the predictive power of ESP. Then again, a positive ESP is a prerequisite when it comes to predicting an earnings beat.
We caution against stocks with Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
You could consider the following stocks with a positive Earnings ESP and a favorable Zacks Rank:
Applied Optoelectronics (AAOI - Free Report) with an Earnings ESP of +15.87% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Alaska Air Group, Inc. (ALK - Free Report) with an Earnings ESP of +5.67% and a Zacks Rank #2.
ACI Worldwide (ACIW - Free Report) with an Earnings ESP of +1.89% and a Zacks Rank #3.
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Trimble Navigation (TRMB - Free Report) is slated to report fourth-quarter 2016 results on Feb 8. In the last-reported quarter, Trimble Navigation recorded a positive earnings surprise of 7.41%.
Over the past one year, shares of Trimble Navigation outperformed the Zacks categorized Electronic Products Miscellaneous industry. While the industry gained 32.18%, the stock returned 57.07%.
Let’s see how things are shaping up for this announcement.
Factors to Consider
Trimble posted decent third-quarter 2016 results with the bottom line surpassing the Zacks Consensus Estimate and the top line missing the same. Earnings were backed by solid expense management.
Pro forma gross margin was also up sequentially driven by a favorable mix of products in some businesses.
The company’s Mobile Solutions segment may have continued to benefit from growth in Transportation and Logistics, and is likely to show improvement in the upcoming release. Also, Trimble is watching out for trends in the E&C market to improve from the building construction, and civil engineering and construction businesses. Moreover, its initiatives toward lowering the cost structure will continue to drive gross margins.
However, increasing competition and deferred revenue accounting effects could impact the results.
For the fourth quarter, management expects revenues in the $562–$592 million. The Zacks Consensus Estimate is pegged at $578.2 million. Non-GAAP earnings per share from continuing operations are likely to be in the range of 27–32 cents. GAAP earnings are expected in the range of 11–16 cents.
Earnings Whispers
Our proven model does not conclusively show that Trimble will beat estimates 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. That is not the case here, as you will see below.
Zacks ESP:Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 26 cents. Hence, the difference is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Trimble currently has a Zacks Rank #3 which increases the predictive power of ESP. Then again, a positive ESP is a prerequisite when it comes to predicting an earnings beat.
We caution against stocks with Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
You could consider the following stocks with a positive Earnings ESP and a favorable Zacks Rank:
Applied Optoelectronics (AAOI - Free Report) with an Earnings ESP of +15.87% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Alaska Air Group, Inc. (ALK - Free Report) with an Earnings ESP of +5.67% and a Zacks Rank #2.
ACI Worldwide (ACIW - Free Report) with an Earnings ESP of +1.89% and a Zacks Rank #3.
Just Released – Driverless Cars: Your Roadmap to Mega-Profits Today
In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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