Eaton Corporation (ETN - Free Report) is slated to report first-quarter 2018 financial results, before the market opens, on May 1. The power management company delivered a positive earnings surprise of 3.20% in the last quarter. Let’s see how things are shaping up for this earnings season.
Factors to Consider
Eaton expects first-quarter earnings in the range of $1.00-$1.10 per share and organic revenues to expand 4%. The company expects that negative revenue impact from JV will wipe out gains derived from currency movement.
The Zacks Consensus Estimate for total revenues of $5,089 million for the quarter reflects a 2.4% drop sequentially. Electric Products segment is a major contributor to Eaton’s total revenues. The Zacks Consensus Estimate of $1,789 million for this segment’s revenues projects a drop of 1.8% sequentially.
Eaton is expected to gain from its restructuring initiatives and share repurchases, completed in the last two years.
Earnings Whispers
Our proven model does not show that Eaton is likely to beat estimates this quarter, as it does not possess the key components. 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. However, that is not the case here as you will see below.
Zacks ESP: The company’s Earnings ESP is -0.82%. This is because the Most Accurate estimate of $1.05 is a penny lower than the Zacks Consensus Estimate of $1.06 per share.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Eaton’s Zacks Rank #2, when combined with a negative Earnings ESP makes a beat unlikely 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 a negative estimate revisions momentum.
Stocks With Favorable Combination
Eaton does not have the right mix, but one can consider some companies from the Zacks Industrial Products sector that have the right combination of elements to post an earnings beat this quarter.
Timken Company (TKR - Free Report) has an Earnings ESP of +2.79% and a Zacks Rank #2. It is expected to report first-quarter 2018 earnings on May 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kennametal (KMT - Free Report) has an Earnings ESP of +1.73% and a Zacks Rank #2. It is expected to report third-quarter fiscal 2018 earnings on May 3.
Tenaris S.A. (TS - Free Report) has an Earnings ESP of +3.57% and a Zacks Rank #2. It is expected to report first-quarter 2018 earnings on Apr 26.
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Eaton Corporation (ETN - Free Report) is slated to report first-quarter 2018 financial results, before the market opens, on May 1. The power management company delivered a positive earnings surprise of 3.20% in the last quarter. Let’s see how things are shaping up for this earnings season.
Factors to Consider
Eaton expects first-quarter earnings in the range of $1.00-$1.10 per share and organic revenues to expand 4%. The company expects that negative revenue impact from JV will wipe out gains derived from currency movement.
The Zacks Consensus Estimate for total revenues of $5,089 million for the quarter reflects a 2.4% drop sequentially. Electric Products segment is a major contributor to Eaton’s total revenues. The Zacks Consensus Estimate of $1,789 million for this segment’s revenues projects a drop of 1.8% sequentially.
Eaton is expected to gain from its restructuring initiatives and share repurchases, completed in the last two years.
Earnings Whispers
Our proven model does not show that Eaton is likely to beat estimates this quarter, as it does not possess the key components. 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. However, that is not the case here as you will see below.
Zacks ESP: The company’s Earnings ESP is -0.82%. This is because the Most Accurate estimate of $1.05 is a penny lower than the Zacks Consensus Estimate of $1.06 per share.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Eaton’s Zacks Rank #2, when combined with a negative Earnings ESP makes a beat unlikely 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 a negative estimate revisions momentum.
Stocks With Favorable Combination
Eaton does not have the right mix, but one can consider some companies from the Zacks Industrial Products sector that have the right combination of elements to post an earnings beat this quarter.
Timken Company (TKR - Free Report) has an Earnings ESP of +2.79% and a Zacks Rank #2. It is expected to report first-quarter 2018 earnings on May 1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kennametal (KMT - Free Report) has an Earnings ESP of +1.73% and a Zacks Rank #2. It is expected to report third-quarter fiscal 2018 earnings on May 3.
Tenaris S.A. (TS - Free Report) has an Earnings ESP of +3.57% and a Zacks Rank #2. It is expected to report first-quarter 2018 earnings on Apr 26.
Investor Alert: Breakthroughs Pending
A medical advance is now at the flashpoint between theory and realization. Billions of dollars in research have poured into it. Companies are already generating substantial revenue, and even more wondrous products are in the pipeline.
Cures for a variety of deadly diseases are in sight, and so are big potential profits for early investors. Zacks names 5 stocks to buy now.
Click here to see them >>
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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