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Pentair (PNR) to Report Q4 Earnings: What's in the Offing?
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Pentair plc (PNR - Free Report) is scheduled to report fourth-quarter 2022 results on Jan 31, before the opening bell.
Q3 Results & Surprise History
Pentair’s revenues and earnings improved in third-quarter 2022 and also beat the Zacks Consensus Estimate. The company has an impressive earnings surprise history. Pentair beat earnings estimates in each of the trailing four quarters, the average surprise being 3.9%.
Q4 Estimates
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $995 million, indicating growth of 0.6% from the year-ago reported figure. The same for earnings is pegged at 79 cents per share, suggesting a decline of 9% year over year. The Zacks Consensus Estimate for quarterly earnings has remained unchanged over the past 30 days.
Our proven model predicts an earnings beat for Pentair for the fourth quarter. 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. This is precisely the case here.
You can uncover the best stocks before they're reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Pentair is 0.90%.
Zacks Rank: Pentair currently carries a Zacks Rank of 3.
During the first half of 2022, Pentair’s inventory levels increased to support market demand and ongoing supply-chain challenges. However, in the third quarter of 2022, it saw the normalization of inventory levels within residential distributor channels. PNR had planned to clear out nearly $200 million of the channel inventory pool in the fourth quarter. These optimization efforts are expected to have impacted volume levels in the quarter under review. Also, the pool business has historically tended to be at lower levels in the fourth compared to the second and third quarters due to seasonal factors. These factors are likely to get reflected in PNR’s top-line performance in the fourth quarter.
Pentair has been witnessing a tight supply of raw materials such as metals, resins and electronics along with rising logistics costs. While it has been implementing pricing actions and focusing on productivity improvements that may have negated these headwinds, supply-chain pressures and inflationary costs are likely to have weighed on the quarter’s performance.
During the first nine months of 2022, the Consumer Solutions segment saw a year-over-year decline in the backlog. Shipments outpaced new orders during the period as customers balanced the need to place new orders with market demand and channel inventory levels. This downward trend may continue in the fourth quarter of 2022 as the backlog is expected to return to historical levels.
The Zacks Consensus Estimate for the Consumer Solutions segment’s revenues is currently pegged at $644 million, suggesting an improvement of 2% from the year-ago quarter. The consensus mark for the segment’s operating profit for the quarter is pinned at $147 million, indicating year-over-year growth of 8%.
The Zacks Consensus Estimate for the Industrial & Flow Technologies segment’s revenues is pegged at $363 million, indicating an improvement of 1% from the prior-year quarter. The consensus mark for the segment’s operating profit stands at $58 million, suggesting growth of 7% from the $54 million reported a year ago.
Price Performance
Image Source: Zacks Investment Research
Shares of the company have declined 42.3% in the past year compared with the industry’s 48.6% plunge.
Stocks Poised to Beat Earnings Estimates
Here are some Industrial Products stocks, which according to our model have the right combination of elements to post an earnings beat in their upcoming releases:
Deere & Co. (DE - Free Report) currently has an Earnings ESP of +2.83% and a Zacks Rank of 2. The Zacks Consensus Estimate for DE’s first-quarter fiscal 2023 earnings has moved 2.6% north in the past 60 days and is currently pegged at $5.49 per share. The consensus mark suggests year-over-year growth of 88.1%
The Zacks Consensus Estimate for DE’s quarterly revenues is pegged at $11.4 billion, indicating growth of 33.9% from the prior-year quarter’s levels. DE has a trailing four-quarter earnings surprise of 7.1%, on average.
Xylem (XYL - Free Report) currently has an Earnings ESP of +2.10% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter 2022 earnings has been stable in the past 60 days and is currently pegged at 79 cents per share. This suggests year-over-year growth of 25.4%
The Zacks Consensus Estimate for XYL’s quarterly revenues is pegged at $1.4 billion, indicating year-over-year growth of 6.1%. XYL has a trailing four-quarter earnings surprise of 13.3%, on average.
Illinois Tool Works (ITW - Free Report) currently has an Earnings ESP of +1.92% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter 2022 earnings has increased 0.4% in the past 60 days and is currently pegged at $2.61 per share. This suggests year-over-year growth of 33.8%
The Zacks Consensus Estimate for quarterly revenues is pegged at $3.9 billion, indicating growth of 5.3% from the prior-year quarter’s levels. ITW has a trailing four-quarter earnings surprise of 4.2%, on average.
Image: Bigstock
Pentair (PNR) to Report Q4 Earnings: What's in the Offing?
Pentair plc (PNR - Free Report) is scheduled to report fourth-quarter 2022 results on Jan 31, before the opening bell.
Q3 Results & Surprise History
Pentair’s revenues and earnings improved in third-quarter 2022 and also beat the Zacks Consensus Estimate. The company has an impressive earnings surprise history. Pentair beat earnings estimates in each of the trailing four quarters, the average surprise being 3.9%.
Q4 Estimates
The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $995 million, indicating growth of 0.6% from the year-ago reported figure. The same for earnings is pegged at 79 cents per share, suggesting a decline of 9% year over year. The Zacks Consensus Estimate for quarterly earnings has remained unchanged over the past 30 days.
Pentair plc Price and EPS Surprise
Pentair plc price-eps-surprise | Pentair plc Quote
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Pentair for the fourth quarter. 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. This is precisely the case here.
You can uncover the best stocks before they're reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Pentair is 0.90%.
Zacks Rank: Pentair currently carries a Zacks Rank of 3.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Factors to Note
During the first half of 2022, Pentair’s inventory levels increased to support market demand and ongoing supply-chain challenges. However, in the third quarter of 2022, it saw the normalization of inventory levels within residential distributor channels. PNR had planned to clear out nearly $200 million of the channel inventory pool in the fourth quarter. These optimization efforts are expected to have impacted volume levels in the quarter under review. Also, the pool business has historically tended to be at lower levels in the fourth compared to the second and third quarters due to seasonal factors. These factors are likely to get reflected in PNR’s top-line performance in the fourth quarter.
Pentair has been witnessing a tight supply of raw materials such as metals, resins and electronics along with rising logistics costs. While it has been implementing pricing actions and focusing on productivity improvements that may have negated these headwinds, supply-chain pressures and inflationary costs are likely to have weighed on the quarter’s performance.
During the first nine months of 2022, the Consumer Solutions segment saw a year-over-year decline in the backlog. Shipments outpaced new orders during the period as customers balanced the need to place new orders with market demand and channel inventory levels. This downward trend may continue in the fourth quarter of 2022 as the backlog is expected to return to historical levels.
The Zacks Consensus Estimate for the Consumer Solutions segment’s revenues is currently pegged at $644 million, suggesting an improvement of 2% from the year-ago quarter. The consensus mark for the segment’s operating profit for the quarter is pinned at $147 million, indicating year-over-year growth of 8%.
The Zacks Consensus Estimate for the Industrial & Flow Technologies segment’s revenues is pegged at $363 million, indicating an improvement of 1% from the prior-year quarter. The consensus mark for the segment’s operating profit stands at $58 million, suggesting growth of 7% from the $54 million reported a year ago.
Price Performance
Image Source: Zacks Investment Research
Shares of the company have declined 42.3% in the past year compared with the industry’s 48.6% plunge.
Stocks Poised to Beat Earnings Estimates
Here are some Industrial Products stocks, which according to our model have the right combination of elements to post an earnings beat in their upcoming releases:
Deere & Co. (DE - Free Report) currently has an Earnings ESP of +2.83% and a Zacks Rank of 2. The Zacks Consensus Estimate for DE’s first-quarter fiscal 2023 earnings has moved 2.6% north in the past 60 days and is currently pegged at $5.49 per share. The consensus mark suggests year-over-year growth of 88.1%
The Zacks Consensus Estimate for DE’s quarterly revenues is pegged at $11.4 billion, indicating growth of 33.9% from the prior-year quarter’s levels. DE has a trailing four-quarter earnings surprise of 7.1%, on average.
Xylem (XYL - Free Report) currently has an Earnings ESP of +2.10% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter 2022 earnings has been stable in the past 60 days and is currently pegged at 79 cents per share. This suggests year-over-year growth of 25.4%
The Zacks Consensus Estimate for XYL’s quarterly revenues is pegged at $1.4 billion, indicating year-over-year growth of 6.1%. XYL has a trailing four-quarter earnings surprise of 13.3%, on average.
Illinois Tool Works (ITW - Free Report) currently has an Earnings ESP of +1.92% and a Zacks Rank of 3. The Zacks Consensus Estimate for fourth-quarter 2022 earnings has increased 0.4% in the past 60 days and is currently pegged at $2.61 per share. This suggests year-over-year growth of 33.8%
The Zacks Consensus Estimate for quarterly revenues is pegged at $3.9 billion, indicating growth of 5.3% from the prior-year quarter’s levels. ITW has a trailing four-quarter earnings surprise of 4.2%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.