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ArcelorMittal (MT) Gears Up for Q2 Earnings: What's in Store?
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ArcelorMittal (MT - Free Report) will release second-quarter 2022 results before the bell on Jul 28. The company’s results are expected to have benefited from cost-reduction actions and higher average steel selling prices amid headwinds from a slowdown in demand and higher input costs.
The steel giant beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of 17.8%, on average. It posted an earnings surprise of 31.4% in the last reported quarter.
Shares of ArcelorMittal have decreased 29.3% in the past year compared with a 22.5% decline of the industry.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
The Zacks Consensus Estimate for second-quarter sales for ArcelorMittal is currently pegged at $22,315 million, which suggests a rise of 15.4% year over year.
The Zacks Consensus Estimate for revenues in the NAFTA segment is currently pegged at $3,329 million, which calls for a rise of 2.7% on a year-over-year comparison basis.
Moreover, the consensus mark for revenues in the Brazil segment is currently pegged at $3,027 million, which calls for a year-over-year decline of 7.2%.
The consensus mark for revenues in the Europe segment is currently pegged at $13,029 million, which suggests a year-over-year rise of 22.1%. The Zacks Consensus Estimate for revenues in the Asia Africa and CIS segment is currently pegged at $2,237 million, calling for a decline of 19.2% year over year.
The consensus mark for revenues in the Mining segment is currently pegged at $1,012 million, which reflects a year-over-year rise of 13.8%.
Some Factors at Play
ArcelorMittal’s second-quarter results are likely to have benefited from cost-reduction actions in the wake of the coronavirus pandemic.The company’s cost-reduction initiatives will likely to have supported profitability in the quarter to be reported. It remains focused on maintaining a competitive cost advantage.
The company is also likely to have gained from higher average steel selling prices in the second quarter. Its average steel selling prices rose around 46% year over year in the first quarter, boosting sales and the bottom line. The momentum is expected to have continued in the June quarter. The benefits of higher prices are likely to get reflected on the company’s second-quarter performance.
However, it is expected to have faced headwinds due to a slowdown in steel demand. Demand in China is expected to be affected by the softness in real estate. Demand in Europe is also expected to have been affected by rising inflation. Demand in Brazil is also likely to have been affected by destocking.
The company’s results are also likely to be impacted by headwinds from cost inflation. It is seeing higher raw material and energy prices, which is affecting its margins. Higher costs stemming from Europe’s energy crisis are affecting its Europe segment.
Zacks Model
Our proven model does not conclusively predict an earnings beat for ArcelorMittal this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for ArcelorMittal is 0.00%. The Zacks Consensus Estimate for earnings for the second quarter is currently pegged at $3.90. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ArcelorMittal currently carries a Zacks Rank #4 (Sell).
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
The Zacks Consensus Estimate for Albemarle’s second-quarter earnings has been revised 21.5% upward in the past 60 days. The consensus estimate for ALB’s earnings for the quarter is currently pegged at $2.94.
Cabot Corporation (CBT - Free Report) , slated to release earnings on Aug 8, has an Earnings ESP of +0.16% and sports a Zacks Rank #1.
The consensus estimate for Cabot’s fiscal third-quarter earnings has been revised 1% upward in the past 60 days. The Zacks Consensus Estimate for CBT’s earnings for the quarter is pegged at $1.53.
Tronox Holdings Inc. (TROX - Free Report) , slated to release earnings on Jul 27, has an Earnings ESP of +3.57% and carries a Zacks Rank #3.
The consensus estimate for Tronox’s second-quarter earnings has been revised 0.6% upward in the past 60 days. The Zacks Consensus Estimate for TROX’s earnings for the quarter is pegged at 84 cents.
Image: Bigstock
ArcelorMittal (MT) Gears Up for Q2 Earnings: What's in Store?
ArcelorMittal (MT - Free Report) will release second-quarter 2022 results before the bell on Jul 28. The company’s results are expected to have benefited from cost-reduction actions and higher average steel selling prices amid headwinds from a slowdown in demand and higher input costs.
The steel giant beat the Zacks Consensus Estimate for earnings in each of the last four quarters. It has a trailing four-quarter earnings surprise of 17.8%, on average. It posted an earnings surprise of 31.4% in the last reported quarter.
Shares of ArcelorMittal have decreased 29.3% in the past year compared with a 22.5% decline of the industry.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
The Zacks Consensus Estimate for second-quarter sales for ArcelorMittal is currently pegged at $22,315 million, which suggests a rise of 15.4% year over year.
The Zacks Consensus Estimate for revenues in the NAFTA segment is currently pegged at $3,329 million, which calls for a rise of 2.7% on a year-over-year comparison basis.
Moreover, the consensus mark for revenues in the Brazil segment is currently pegged at $3,027 million, which calls for a year-over-year decline of 7.2%.
The consensus mark for revenues in the Europe segment is currently pegged at $13,029 million, which suggests a year-over-year rise of 22.1%.
The Zacks Consensus Estimate for revenues in the Asia Africa and CIS segment is currently pegged at $2,237 million, calling for a decline of 19.2% year over year.
The consensus mark for revenues in the Mining segment is currently pegged at $1,012 million, which reflects a year-over-year rise of 13.8%.
Some Factors at Play
ArcelorMittal’s second-quarter results are likely to have benefited from cost-reduction actions in the wake of the coronavirus pandemic.The company’s cost-reduction initiatives will likely to have supported profitability in the quarter to be reported. It remains focused on maintaining a competitive cost advantage.
The company is also likely to have gained from higher average steel selling prices in the second quarter. Its average steel selling prices rose around 46% year over year in the first quarter, boosting sales and the bottom line. The momentum is expected to have continued in the June quarter. The benefits of higher prices are likely to get reflected on the company’s second-quarter performance.
However, it is expected to have faced headwinds due to a slowdown in steel demand. Demand in China is expected to be affected by the softness in real estate. Demand in Europe is also expected to have been affected by rising inflation. Demand in Brazil is also likely to have been affected by destocking.
The company’s results are also likely to be impacted by headwinds from cost inflation. It is seeing higher raw material and energy prices, which is affecting its margins. Higher costs stemming from Europe’s energy crisis are affecting its Europe segment.
Zacks Model
Our proven model does not conclusively predict an earnings beat for ArcelorMittal this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for ArcelorMittal is 0.00%. The Zacks Consensus Estimate for earnings for the second quarter is currently pegged at $3.90. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: ArcelorMittal currently carries a Zacks Rank #4 (Sell).
ArcelorMittal Price and EPS Surprise
ArcelorMittal price-eps-surprise | ArcelorMittal Quote
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
Albemarle Corporation (ALB - Free Report) , scheduled to release earnings on Aug 3, has an Earnings ESP of +11.9% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Albemarle’s second-quarter earnings has been revised 21.5% upward in the past 60 days. The consensus estimate for ALB’s earnings for the quarter is currently pegged at $2.94.
Cabot Corporation (CBT - Free Report) , slated to release earnings on Aug 8, has an Earnings ESP of +0.16% and sports a Zacks Rank #1.
The consensus estimate for Cabot’s fiscal third-quarter earnings has been revised 1% upward in the past 60 days. The Zacks Consensus Estimate for CBT’s earnings for the quarter is pegged at $1.53.
Tronox Holdings Inc. (TROX - Free Report) , slated to release earnings on Jul 27, has an Earnings ESP of +3.57% and carries a Zacks Rank #3.
The consensus estimate for Tronox’s second-quarter earnings has been revised 0.6% upward in the past 60 days. The Zacks Consensus Estimate for TROX’s earnings for the quarter is pegged at 84 cents.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.