The first-quarter 2020 results of Industrial Products, which is one of the 16 Zacks sectors, might mirror the adverse impacts of the coronavirus outbreak and other headwinds.
Earnings for the sector are predicted to decline 21.5% year over year for first-quarter 2020, while revenues and margins are expected to fall 4.8% and 1.9%, respectively. Notably, the sector’s earnings in the fourth quarter of 2019 increased 0.7%, while revenues declined 0.2% and margins grew 0.1% year over year.
Key Factors for Industrial Stocks
Operating conditions in the first quarter were weak for industrial stocks due to the pandemic-related worries. Per the official data, industrial production in the United States declined 5.4% (month over month) in March. The metric fell 0.5% in January, while inched up 0.5% in February.
In addition, the country’s Purchasing Managers' Index (“PMI”) also points toward difficulties for industrial stocks. The ISM’s report states that the country’s PMI fell from 50.1% in February to 49.1% in March. The index’s value below 50% indicates a contraction in manufacturing activities. Notably, PMI stood at 50.9% in January.
The measures undertaken to control the virus spread might have adversely impacted product demand, international operations, supply-chain activities, manufacturing actions, marketing techniques and others. However, actions — including interest rate cuts by the Federal Reserve and a $2-trillion relief package by the U.S. government — to fight the pandemic-related woes might have aided the companies in the sector.
Also, unfavorable movements in foreign currencies, cost-related woes and huge debts might have impacted industrial companies. Multiple sub-industries within the sector — including material handling, tools and products, industrial services, farm equipment, electronics, construction and mining equipment, and others — might have suffered due to the pandemic in the quarter.
Stocks Due for Earnings Release on Apr 22
Below, we briefly discussed what we expect from the three industrial stocks in the first quarter of 2020.
Graco Inc. (GGG - Free Report) will release first-quarter results after market close. It delivered better-than-expected results in one of the last four quarters, while lagging estimates in others. Earnings surprise for the period was a positive 0.40%, on average.
Graco Inc. Price and EPS Surprise
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 >>
The first-quarter 2020 results of Industrial Products, which is one of the 16 Zacks sectors, might mirror the adverse impacts of the coronavirus outbreak and other headwinds.
Earnings for the sector are predicted to decline 21.5% year over year for first-quarter 2020, while revenues and margins are expected to fall 4.8% and 1.9%, respectively. Notably, the sector’s earnings in the fourth quarter of 2019 increased 0.7%, while revenues declined 0.2% and margins grew 0.1% year over year.
Key Factors for Industrial Stocks
Operating conditions in the first quarter were weak for industrial stocks due to the pandemic-related worries. Per the official data, industrial production in the United States declined 5.4% (month over month) in March. The metric fell 0.5% in January, while inched up 0.5% in February.
In addition, the country’s Purchasing Managers' Index (“PMI”) also points toward difficulties for industrial stocks. The ISM’s report states that the country’s PMI fell from 50.1% in February to 49.1% in March. The index’s value below 50% indicates a contraction in manufacturing activities. Notably, PMI stood at 50.9% in January.
The measures undertaken to control the virus spread might have adversely impacted product demand, international operations, supply-chain activities, manufacturing actions, marketing techniques and others. However, actions — including interest rate cuts by the Federal Reserve and a $2-trillion relief package by the U.S. government — to fight the pandemic-related woes might have aided the companies in the sector.
Also, unfavorable movements in foreign currencies, cost-related woes and huge debts might have impacted industrial companies. Multiple sub-industries within the sector — including material handling, tools and products, industrial services, farm equipment, electronics, construction and mining equipment, and others — might have suffered due to the pandemic in the quarter.
Stocks Due for Earnings Release on Apr 22
Below, we briefly discussed what we expect from the three industrial stocks in the first quarter of 2020.
Graco Inc. (GGG - Free Report) will release first-quarter results after market close. It delivered better-than-expected results in one of the last four quarters, while lagging estimates in others. Earnings surprise for the period was a positive 0.40%, on average.
Graco Inc. Price and EPS Surprise
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 >>
Get the latest research report on SLGN - FREE
Get the latest research report on GGG - FREE
Get the latest research report on MSA - FREE