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

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Ball Corporation is scheduled to report third-quarter 2021 results on Nov 4, before the opening bell.

Q2 Performance

In the last reported quarter, Ball Corp’s earnings and revenues increased year over year, reflecting solid global beverage-can volume growth. The company also beat the Zacks Consensus Estimate on both counts.

The company has a trailing four-quarter average earnings surprise of 7.63%.

Q3 Estimates

The Zacks Consensus Estimate for the third-quarter earnings per share is pegged at 98 cents, suggesting growth of 10.1% from the prior-year period. The Zacks Consensus Estimate for total sales stands at $3.60 billion, indicating a year-over-year improvement of 16.5%.

Factors to Note

Ball Corp provides key aluminum packaging products and services to consumer-oriented end-markets, such as food and beverages, household and healthcare. Demand for these products has been robust on the increased at-home consumption amid the pandemic. The company has been gaining from the strong global beverage-can demand as consumers now prefer cans over glass and plastic. These factors are likely to have favored the third-quarter performance. The company has been focused on improving its efficiency and reducing costs. These initiatives are anticipated to have boosted the company’s margin in the to-be-reported quarter.

The Beverage packaging, North and Central America segment is projected to have generated sales of $1,506 million during the September-end quarter, calling for a 13.5% year-over-year increase. The segmental operating income is estimated at $212 million compared with the prior-year quarter’s $209 million. Operational efficiency, new customer contracts and solid demand for aluminum beverage packaging are likely to have aided the segment during the quarter to be reported.

The Zacks Consensus Estimate for the Beverage packaging, South America segment’s net sales is pegged at $498 million, suggesting growth of 15.3% from the year-ago period. This reflects demand for beverage cans. The segment’s operating income is pinned at $78 million, indicating year-over-year growth of 21.8%.

The Zacks Consensus Estimate for the Beverage packaging, Europe segment’s sales stands at $890 million for the to-be-reported quarter, calling for an improvement of 10% from the prior-year quarter. The segment’s operating income is projected at $130 million, suggesting an improvement of 11.1%, year over year. Increasing demand for cans and the company’s investment in incremental capacity in its existing facilities is expected to have contributed to the segment’s performance during the quarter under review.

The Aerospace segment’s contracted backlog remained strong at $3 billion as of the end of second-quarter 2021. Program execution remains at a high level across the business. The segment continues to win and provide mission-critical programs and technologies to the U.S. government, defense, intelligence, reconnaissance and surveillance customers. This is likely to get reflected in the segment’s third-quarter top-line results. The Zacks Consensus Estimate for the Aerospace segment's revenues is pegged at $510 million for the period in discussion, indicating a year-over-year improvement of 13%. The segment’s operating income is projected at $48.7 million, suggesting year-over-year growth of 10.7%.

The company might have incurred higher-than-expected start-up costs due to its ongoing capacity-expansion efforts to meet the growing demand for cans. Further, incremental costs related to the COVID-19 pandemic are expected to have dampened the near-term price/mix. Ball Corp has been importing cans to meet demand until its new plants ramp up, which might have led to higher freight costs. These factors are likely to have weighed on its margins during the quarter to be reported.

Ball Corporation Price and EPS Surprise

Ball Corporation Price and EPS Surprise

Ball Corporation price-eps-surprise | Ball Corporation Quote

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Ball Corp this season. The combination of a positive Earnings ESP, and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the odds of a positive surprise. But that’s 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: Ball Corp has an Earnings ESP of 0.00%.

Zacks Rank: Currently, the company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Price Performance

Shares of Ball Corp have gained 2.2%, in the past year, compared with the industry's rally of 7.4%.

Zacks Investment ResearchImage Source: Zacks Investment Research

Stocks Worth a Look

Here are some Industrial Products stocks worth considering as these have the right combination of elements to post an earnings beat in their upcoming releases:

Tetra Tech, Inc. (TTEK - Free Report) has a Zacks Rank #2 and carries an Earnings ESP of +0.50%, at present.

Deere & Company (DE - Free Report) has an Earnings ESP of +5.55% and carries a Zacks Rank of 2, currently.

MRC Global Inc. (MRC - Free Report) , a Zacks #3 Ranked stock, has an Earnings ESP of +2.94%.

In-Depth Zacks Research for the Tickers Above

One ticker, your choice, absolutely free ($25 value):

Tetra Tech, Inc. (TTEK) - free report >>

Deere & Company (DE) - free report >>

MRC Global Inc. (MRC) - free report >>

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