We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Fortune Brands (FBHS) to Post Q4 Earnings: Beat in Store?
Read MoreHide Full Article
Fortune Brands Home & Security, Inc. is scheduled to report fourth-quarter 2020 results on Feb 2, after market close.
The company delivered better-than-expected results in each of the trailing four quarters. Earnings surprise for the last four quarters was a positive 23.02%, on average. In the last reported quarter, it posted earnings of $1.19 per share, which beat the Zacks Consensus Estimate of $1.06 by 12.26%.
In the past three months, the company has gained 8.1% compared with the industry’s growth of 12.4%.
Factors at Play
Healthy demand for doors and decking products, coupled with strength in its security business, backed by investments for product innovations, is likely to have boosted fourth-quarter revenues of the Outdoors & Security segment. Also, growing popularity of its value price point cabinetry products might have supported the Cabinets segment. Further, solid momentum across Fortune Brands’ plumbing business, driven by strong brands and the success of its category and channel expansion strategies, is expected to have boosted its Plumbing segment’s revenues.
Also, the company’s focus on supply-chain optimization, operational efficiency, cost-control measures and other initiatives are likely to have helped it improve margins and profitability in the fourth quarter.
Moreover, the company’s Fiberon business, which has been complementing its existing door brand — Therma-Tru — and strengthening its growth opportunities in the outdoor living space, is anticipated to have augmented its fourth-quarter top-line performance. Notably, the Fiberon decking brand grew significantly in the past couple of quarters, a trend which is likely to have continued in the fourth quarter as well given strong demand for its products.
However, Fortune Brands has been experiencing rising cost of sales over the past few quarters, despite its cost-reduction initiatives. In the first nine months of 2020, its cost of sales recorded a year-over-year increase of 3.6%. Notably, in the third quarter, its cost of sales and its selling, general and administrative expenses jumped 14.6% and 5.5%, respectively, on a year-over-year basis. This might have weighed on its margins and profitability in the to-be reported quarter.
Notably, the Zacks Consensus Estimate for the Plumbing segment's revenues is pegged at $596 million, reflecting growth of 8.8% from the year-ago reported number. The consensus estimate for Cabinets segment’s revenues stands at $642 million, implying growth of 8.6% from the reported figure in the year-ago quarter. The consensus mark for Outdoors & Security segment’s revenues stands at $375 million, implying a 13.3% year-over-year increase.
Earnings Whispers
Our proven model suggests an earnings beat for Fortune Brands 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. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. This is the case here as elaborated below.
Earnings ESP: The company has an Earnings ESP of +1.47% as the Most Accurate Estimate is pegged at $1.18, higher than the Zacks Consensus Estimate of $1.16.
Fortune Brands Home & Security, Inc. Price and EPS Surprise
Zacks Rank: Fortune Brands carries a Zacks Rank #3.
Other Key Picks
Here are some other companies you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this season:
Kennametal Inc. (KMT - Free Report) has an Earnings ESP of +30.00% and a Zacks Rank of 2.
Eaton Corporation, plc (ETN - Free Report) has an Earnings ESP of +2.33% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Fortune Brands (FBHS) to Post Q4 Earnings: Beat in Store?
Fortune Brands Home & Security, Inc. is scheduled to report fourth-quarter 2020 results on Feb 2, after market close.
The company delivered better-than-expected results in each of the trailing four quarters. Earnings surprise for the last four quarters was a positive 23.02%, on average. In the last reported quarter, it posted earnings of $1.19 per share, which beat the Zacks Consensus Estimate of $1.06 by 12.26%.
In the past three months, the company has gained 8.1% compared with the industry’s growth of 12.4%.
Factors at Play
Healthy demand for doors and decking products, coupled with strength in its security business, backed by investments for product innovations, is likely to have boosted fourth-quarter revenues of the Outdoors & Security segment. Also, growing popularity of its value price point cabinetry products might have supported the Cabinets segment. Further, solid momentum across Fortune Brands’ plumbing business, driven by strong brands and the success of its category and channel expansion strategies, is expected to have boosted its Plumbing segment’s revenues.
Also, the company’s focus on supply-chain optimization, operational efficiency, cost-control measures and other initiatives are likely to have helped it improve margins and profitability in the fourth quarter.
Moreover, the company’s Fiberon business, which has been complementing its existing door brand — Therma-Tru — and strengthening its growth opportunities in the outdoor living space, is anticipated to have augmented its fourth-quarter top-line performance. Notably, the Fiberon decking brand grew significantly in the past couple of quarters, a trend which is likely to have continued in the fourth quarter as well given strong demand for its products.
However, Fortune Brands has been experiencing rising cost of sales over the past few quarters, despite its cost-reduction initiatives. In the first nine months of 2020, its cost of sales recorded a year-over-year increase of 3.6%. Notably, in the third quarter, its cost of sales and its selling, general and administrative expenses jumped 14.6% and 5.5%, respectively, on a year-over-year basis. This might have weighed on its margins and profitability in the to-be reported quarter.
Notably, the Zacks Consensus Estimate for the Plumbing segment's revenues is pegged at $596 million, reflecting growth of 8.8% from the year-ago reported number. The consensus estimate for Cabinets segment’s revenues stands at $642 million, implying growth of 8.6% from the reported figure in the year-ago quarter. The consensus mark for Outdoors & Security segment’s revenues stands at $375 million, implying a 13.3% year-over-year increase.
Earnings Whispers
Our proven model suggests an earnings beat for Fortune Brands 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. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. This is the case here as elaborated below.
Earnings ESP: The company has an Earnings ESP of +1.47% as the Most Accurate Estimate is pegged at $1.18, higher than the Zacks Consensus Estimate of $1.16.
Fortune Brands Home & Security, Inc. Price and EPS Surprise
Fortune Brands Home & Security, Inc. price-eps-surprise | Fortune Brands Home & Security, Inc. Quote
Zacks Rank: Fortune Brands carries a Zacks Rank #3.
Other Key Picks
Here are some other companies you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this season:
Axon Enterprise, Inc (AXON - Free Report) has an Earnings ESP of +0.93% and a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Kennametal Inc. (KMT - Free Report) has an Earnings ESP of +30.00% and a Zacks Rank of 2.
Eaton Corporation, plc (ETN - Free Report) has an Earnings ESP of +2.33% and a Zacks Rank #3.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>