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Pall Corp: Will it Miss or Beat Earnings?

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Pall Corporation is set to report third quarter 2013 results on May 30, 2013. Last quarter it posted an 8.96% positive surprise. Let’s see how things are shaping up for this announcement.

Growth Factors this Past Quarter

Pall entered into research collaboration with Lewis University for the second year in succession to broaden its scope of research on microchips manufacturing. The company also entered into research collaboration with King Abdullah University of Science and Technology (KAUST) in Saudi Arabia to take part in a joint research program in the areas of filtration, separation and purification technologies. All these research projects are expected to benefit the company in developing new and improved products that will augment its revenues in the future.

In addition, the company is expanding its operations in new markets in UAE and Asia. Along with the KAUST collaboration, it also opened its second office in the Middle East to strengthen its regional presence. These initiatives further prove Pall’s sustained dedication to improve its business performance in the Middle East region.

Earnings Whispers?

Our proven model does not conclusively show that Pall is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP (Read: Zacks Earnings ESP: A Better Method) and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Negative Zacks ESP:  That is because the Most Accurate estimate stands at 71 cents while the Zacks Consensus Estimate is higher at 73 cents. That is a difference of -2.7%.

Zacks Rank #2 (Buy). Pall’s Zacks Rank #2 (Buy) lowers the predictive power of ESP because the Zacks Rank #2 when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with Zacks Ranks of #4 and #5 (Sell rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Some other companies that are worth reckoning at the moment include:

CECO Environmental Corp. (CECE - Free Report) , Earnings ESP of +4.35% and Zacks Rank #1 (Strong Buy)

Primoris Services Corporation (PRIM - Free Report) , Earnings ESP of +10.3% and Zacks Rank #1 (Strong Buy)

Orion Marine Group Inc.(ORN - Free Report) , Earnings ESP of +50.0% and Zacks Rank #2 (Buy)

In-Depth Zacks Research for the Tickers Above

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Orion Group Holdings, Inc. (ORN) - free report >>

Primoris Services Corporation (PRIM) - free report >>

CECO Environmental Corp. (CECE) - free report >>

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