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FMC Corp (FMC) to Report Q3 Earnings: What's in the Offing?

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FMC Corporation (FMC - Free Report) will release third-quarter 2020 results after the closing bell on Nov 2. The company is likely to have benefited from favorable demand for its herbicides and insecticides in the quarter. However, unfavorable impacts from currency swings and cost inflation are likely to reflect on its results.

The company beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters. In this timeframe, it delivered an earnings surprise of 9.6%, on average.

Shares of FMC are up 2.5% year to date, compared with a 4.2% decline of its industry.

 


 

 

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

Zacks Model

Our proven model predicts an earnings beat for FMC this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.

Earnings ESP: Earnings ESP for FMC is +0.36%. The Zacks Consensus Estimate for earnings the third quarter is currently pegged at $1.11. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: FMC currently carries a Zacks Rank #3.

What do the Estimates Say?

The Zacks Consensus Estimate for third-quarter sales for FMC is currently pegged at $1,073 million, which suggests a 5.8% rise year over year.

The Zacks Consensus Estimate for revenues for North America is pinned at $208 million, suggesting a 33.3% decline on a sequential comparison basis. The consensus estimate for Latin America is $493 million, indicating an increase of 88.9% sequentially.

The Zacks Consensus Estimate for Asia stands at $238 million, indicating a 24.9% sequential decline. The same for EMEA (Europe, Middle East, and Africa) is pegged at $151 million, calling for a 43% sequential decline.

Some Factors at Play

Strong demand for the company’s products and benefits of new product launches are likely to get reflected on its third-quarter results. The company is seeing healthy demand for insecticides and herbicides from sugarcane growers in Brazil and solid demand for herbicides in Argentina. It is also seeing strong sales for the Lucento fungicide in North America. In Asia, demand for herbicides also remain strong in India. Demand strength across these regions is likely to have continued in the quarter to be reported.

Moreover, FMC remains focused on boosting its market position and strengthening its product portfolio. It is investing in technologies and products as well as new launches to enhance value to the farmers. New product launches are likely to have contributed to its volumes in the third quarter.

However, FMC is exposed to significant headwind from unfavorable currency translation, which might have impacted its sales and margins in the September quarter. It expects currency impact of $60 million on EBITDA for the third quarter.

The company is also likely to have faced some headwinds from cost inflation, partly due to coronavirus-led disruptions. It sees $10 million cost headwind on its adjusted EBITDA in the third quarter. Higher costs are likely to have weighed on its margins in the quarter to be reported.

 

FMC Corporation Price and EPS Surprise

 

FMC Corporation Price and EPS Surprise

FMC Corporation price-eps-surprise | FMC Corporation Quote

 

Other Stocks That Warrant a Look

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

Green Plains Inc. (GPRE - Free Report) , scheduled to release earnings on Nov 4, has an Earnings ESP of +1.82% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Albemarle Corporation (ALB - Free Report) , scheduled to release earnings on Nov 4, has an Earnings ESP of +5.73% and carries a Zacks Rank #3.

Cabot Corporation (CBT - Free Report) , scheduled to release earnings on Nov 9, has an Earnings ESP of +26.44% and carries a Zacks Rank #3.

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