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Here's What to Expect Ahead of Aspen's (AZPN) Q2 Earnings

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Aspen Technology (AZPN - Free Report) is scheduled to report second-quarter fiscal 2023 results on Jan 25.

The Zacks Consensus Estimate for earnings is pegged at $1.27 per share, indicating an increase of 5.8% on a year-over-year basis. The Zacks Consensus Estimate for revenues is pegged at $272.1 million, suggesting an increase of 58.8% from the prior-year quarter’s levels.

The company surpassed the Zacks Consensus Estimate in three of the last four quarters. It has a trailing four-quarter earnings surprise of 19.3%, on average. In the past year, shares of the company have risen 35.3% against the sub-industry’s decline of 49.4%.

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Factors to Note

Higher demand for Aspen Technology’s asset optimization and management software solutions and Asset Performance Management suite is likely to have positively impacted the top-line performance in the to-be-reported quarter. The company is expected to have benefited from the rapid adoption of cloud-based solutions, integration with big data analytics, increased proliferation of the Internet of Things and increased investment in software.

Strong pipeline of bookings and momentum in dealer grid management (DGM) and Subsurface Science and Engineering (SSE) product portfolios are likely to have acted as tailwinds. In the last reported quarter, the DGM product portfolio generated $16.9 million in software license orders.

Last year, the company completed the merger involving the integration of Emerson's OSI Inc. and GSS businesses. Aspen plans to leverage OSI’s DGM product portfolio to develop its transmission and distribution offering to support power grid modernization and ensure grid reliability. These are likely to have positively impacted the top line in the fiscal second quarter.

Also, the SSE business segment is likely to have helped the company tap growing markets, such as carbon capture and sequestration, and geothermal energy. Increasing sustainability capex investments toward implementing projects in low-carbon energy space like hydrogen, carbon capture and sequestration, solar, biofuels and wind, among others, bode well.

However, protracted supply-chain troubles, uncertainty prevailing over global macroeconomic conditions and inflationary pressure might have weighed on the to-be-reported quarter’s performance.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for Aspen Technology 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.

Aspen Technology has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are some stocks you may consider as our model shows that these have the right combination of elements to beat on earnings this season.

Halliburton Company (HAL - Free Report) has an Earnings ESP of +0.30% and currently carries a Zacks Rank of 2. HAL is set to announce quarterly figures on Jan 24. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Halliburton’s to-be-reported quarter’s earnings and revenues is pegged at 67 cents per share and $5.58 billion, respectively. Shares of HAL have risen 46% in the past year.

SAP SE (SAP - Free Report) has an Earnings ESP of +3.09% and presently carries a Zacks Rank #2. SAP is slated to release quarterly numbers on Jan 26.

The Zacks Consensus Estimate for SAP’s to-be-reported quarter’s earnings and revenues is pegged at $1.38 per share and $8.23 billion, respectively. Shares of SAP have lost 14.8% in the past year.

American Airlines Group (AAL - Free Report) has an Earnings ESP of +16.71% and currently has a Zacks Rank #2. AAL is scheduled to report earnings on Jan 26.

The Zacks Consensus Estimate for AAL’s to-be-reported quarter’s earnings and revenues is pegged at 75 cents per share and $12.84 billion, respectively. Shares of AAL have dipped 0.1% in the past year.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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