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WestRock (WRK) to Report Q1 Earnings: What's in the Cards?
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WestRock Company (WRK - Free Report) is scheduled to report first-quarter fiscal 2021 results (ended as of Dec 31, 2020) on Jan 28, before the opening bell.
Q1 Estimates
The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $4.4 billion, suggesting a decline of 0.6% from the year-ago quarter. The same for earnings per share stands at 54 cents, indicating a year-over-year drop of 7%. The Zacks Consensus Estimate for the company’s fiscal first-quarter 2021 earnings has remained stable over the past 30 days.
Q4 Performance
WestRock’s adjusted earnings per share and revenues both beat the Zacks Consensus Estimate. Notably, the company has surpassed earnings estimates in each of the trailing four quarters, the average surprise being 23.4%.
Our proven model does not conclusively predict an earnings beat for WestRock this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat but that is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for WestRock is -0.62%.
Zacks Rank: WestRock currently carries a Zacks Rank of 2.
Key Factors to Note
Packaging products are essential for the distribution of food, beverage and pharmaceutical products. Further, the coronavirus pandemic induced stay-at-home orders and restrictions worldwide have fueled demand for online grocery, beverage and pharmaceuticals delivery services, which in turn drove e-commerce growth. Consequently, the company’s Consumer Packaging segment is anticipated to have benefited in the fiscal first quarter from elevated demand for the packaging of food, beverages, household cleaning and liquid packaging.
However, waning demand across few of WestRock’s businesses due to the coronavirus crisis might have weighed on the to-be-reported quarter’s performance. Demand in foodservice has been impacted by closure of restaurants, schools and other services. Commercial print demand has also been constrained due to limited public events, and reduced retail and direct mail advertising. Luxury goods has also been hit hard. These factors may have dented the company’s fiscal first-quarter performance.
Also, normal seasonal sequential volume declines in many of its businesses, including merchandising displays, Victory Packaging business, and food and beverage might have impacted the to-be-reported quarter’s performance. Higher natural gas and freight cost due to winter may also get reflected in the fiscal first-quarter results.
WestRock acquired KapStone Paper and Packaging Corp in 2019, with the integration on track. The buyout has helped the company cement its presence in the western United States. Further, the company continues to boost its North American corrugated packaging business margins. These moves are likely to have contributed to the fiscal first-quarter 2021 performance. In addition, productivity, performance-improvement programs across its manufacturing footprint and cost savings are anticipated to have aided the company’s performance during the quarter under review.
The Zacks Consensus Estimate for the Consumer Packaging segment’s quarterly revenues is pegged at $1,547 million, suggesting growth of 1% from the prior-year quarter. The Consumer Packaging segment’s adjusted EBITDA is estimated to be up 4% year over year to $192 million.
For the Corrugated Packaging segment revenues, the Zacks Consensus Estimate is pegged at $2,887 million, indicating a decline of 1% from year-ago quarter. The segment’s adjusted EBITDA is likely to dip 6% year over year to $477 million.
Share Price Performance
WestRock’s shares have gained 10.8% over the past year, compared with the industry’s growth of 13.8%.
Stocks Poised to Beat Estimates
Here are some companies in the basic materials space you may want to consider as our model shows that these have the right combination of elements to post earnings beat this quarter:
Vale S.A (VALE - Free Report) has an Earnings ESP of +4.17% and a Zacks Rank of 1 currently.
Celanese Corporation (CE - Free Report) has an Earnings ESP of +2.38% and a Zacks Rank #2, at present.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Image: Bigstock
WestRock (WRK) to Report Q1 Earnings: What's in the Cards?
WestRock Company (WRK - Free Report) is scheduled to report first-quarter fiscal 2021 results (ended as of Dec 31, 2020) on Jan 28, before the opening bell.
Q1 Estimates
The Zacks Consensus Estimate for fiscal first-quarter revenues is pegged at $4.4 billion, suggesting a decline of 0.6% from the year-ago quarter. The same for earnings per share stands at 54 cents, indicating a year-over-year drop of 7%. The Zacks Consensus Estimate for the company’s fiscal first-quarter 2021 earnings has remained stable over the past 30 days.
Q4 Performance
WestRock’s adjusted earnings per share and revenues both beat the Zacks Consensus Estimate. Notably, the company has surpassed earnings estimates in each of the trailing four quarters, the average surprise being 23.4%.
WestRock Company Price and EPS Surprise
WestRock Company price-eps-surprise | WestRock Company Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for WestRock this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat but that is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for WestRock is -0.62%.
Zacks Rank: WestRock currently carries a Zacks Rank of 2.
Key Factors to Note
Packaging products are essential for the distribution of food, beverage and pharmaceutical products. Further, the coronavirus pandemic induced stay-at-home orders and restrictions worldwide have fueled demand for online grocery, beverage and pharmaceuticals delivery services, which in turn drove e-commerce growth. Consequently, the company’s Consumer Packaging segment is anticipated to have benefited in the fiscal first quarter from elevated demand for the packaging of food, beverages, household cleaning and liquid packaging.
However, waning demand across few of WestRock’s businesses due to the coronavirus crisis might have weighed on the to-be-reported quarter’s performance. Demand in foodservice has been impacted by closure of restaurants, schools and other services. Commercial print demand has also been constrained due to limited public events, and reduced retail and direct mail advertising. Luxury goods has also been hit hard. These factors may have dented the company’s fiscal first-quarter performance.
Also, normal seasonal sequential volume declines in many of its businesses, including merchandising displays, Victory Packaging business, and food and beverage might have impacted the to-be-reported quarter’s performance. Higher natural gas and freight cost due to winter may also get reflected in the fiscal first-quarter results.
WestRock acquired KapStone Paper and Packaging Corp in 2019, with the integration on track. The buyout has helped the company cement its presence in the western United States. Further, the company continues to boost its North American corrugated packaging business margins. These moves are likely to have contributed to the fiscal first-quarter 2021 performance. In addition, productivity, performance-improvement programs across its manufacturing footprint and cost savings are anticipated to have aided the company’s performance during the quarter under review.
The Zacks Consensus Estimate for the Consumer Packaging segment’s quarterly revenues is pegged at $1,547 million, suggesting growth of 1% from the prior-year quarter. The Consumer Packaging segment’s adjusted EBITDA is estimated to be up 4% year over year to $192 million.
For the Corrugated Packaging segment revenues, the Zacks Consensus Estimate is pegged at $2,887 million, indicating a decline of 1% from year-ago quarter. The segment’s adjusted EBITDA is likely to dip 6% year over year to $477 million.
Share Price Performance
WestRock’s shares have gained 10.8% over the past year, compared with the industry’s growth of 13.8%.
Stocks Poised to Beat Estimates
Here are some companies in the basic materials space you may want to consider as our model shows that these have the right combination of elements to post earnings beat this quarter:
The Mosaic Company (MOS - Free Report) has an Earnings ESP of +15.94% and a Zacks Rank of 1 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Vale S.A (VALE - Free Report) has an Earnings ESP of +4.17% and a Zacks Rank of 1 currently.
Celanese Corporation (CE - Free Report) has an Earnings ESP of +2.38% and a Zacks Rank #2, at present.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
Click here for the 6 trades >>