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Suzano (SUZ) to Report Q2 Earnings: What's in Store?

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Suzano (SUZ - Free Report) is likely to report a year-over-year improvement in earnings when it reports second-quarter 2023 results next week.

Q2 Estimates

The Zacks Consensus Estimate for SUZ’s second-quarter earnings is pegged at 98 cents per share. This indicates a solid year-over-year improvement from earnings of 3 cents per share in the year-ago quarter. Earnings estimates have been unchanged in the past seven days.

Q1 Performance

In the last reported quarter, Suzano witnessed year-over-year improvements in revenues while earnings declined. SUZ’s earnings missed the Zacks Consensus Estimate in the quarter. The company has an average surprise of 54.8% in the trailing four quarters.

Suzano S.A. Sponsored ADR Price and EPS Surprise

 

Suzano S.A. Sponsored ADR Price and EPS Surprise

Suzano S.A. Sponsored ADR price-eps-surprise | Suzano S.A. Sponsored ADR Quote

Factors to Note

In the Pulp segment, the company has been witnessing solid demand for sanitary paper. However, a slowdown has been noticed in printing and writing demand as well as specialties paper due to their ample stock with distributors, converters and printers who are beginning to destock. This is likely to have reflected in the segment’s volumes in the second quarter.

However, the increase in input costs as well as higher energy and wood costs have eased somewhat from the year-ago levels. The segment’s margins are expected to reflect this impact.

In the Paper segment, sales in the traditional Printing & Writing paper segment in Brazil are expected to have been solid through the quarter, driven by the publishing and educational materials markets, as well as school and office supplies. In the international markets, the normalization of supplies and logistics chain resulted in the rebuilding of inventories in 2022.

With the economic downturn in markets as North America and Eastern Europe in early 2023, high levels of inventory were observed across the chain. This has led to decline in demand in the Printing & Writing segment, which is expected to impact the segment’s volumes in the quarter under review. However, favorable price is likely to have negated some of the impact on the segment’s results.

The normalization of the logistical situation has brought freight prices closer to historic levels, in addition to reducing congestion. Supply imbalances have been reported to be dissipating and markets are returning to historical trends. This is likely to have favored the segment’s margins.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Suzano 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. But that’s not the case here.

You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Earnings ESP: Suzano has an Earnings ESP of 0.00%.

Zacks Rank: The company currently sports a Zacks Rank of 1.

Price Performance

Shares of Suzano have gained 13.7% in the past year against the industry's 11.1% fall.

 

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Image Source: Zacks Investment Research

 

Stocks to Consider

Here are some Basic Materials stocks, which according to our model, have the right combination of elements to post an earnings beat in their upcoming releases.

ATI Inc. (ATI - Free Report) is scheduled to release first-quarter 2023 earnings on Aug 2. The company has an Earnings ESP of +1.08% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for ATI’s second-quarter earnings has moved up 2% in the past 60 days. The consensus estimate for the compay’s earnings for the quarter is pegged at 55 cents per share, which indicates year-over-year growth of 1.9%. The company has an average surprise of 13% in the trailing four quarters.

Orla Mining (ORLA - Free Report) is expected to release second-quarter 2023 earnings on Aug 14. The company currently has an Earnings ESP of +50.00% and a Zacks Rank of 2.

The Zacks Consensus Estimate for Orla Mining’s second-quarter earnings has moved up 100% in the past 60 days. The consensus mark for Orla Mining’s earnings for the quarter is pegged at 4 cents per share, in-line with the year-ago quarter’s figure. ORLA has an average surprise of 85.4% in the trailing four quarters.

Agnico Eagle Mines (AEM - Free Report) is expected to release second-quarter 2023 earnings on Jul 26. The company has an Earnings ESP of +3.98% and currently carries a Zacks Rank of 3.

The Zacks Consensus Estimate for Agnico Eagle’s second-quarter earnings is pegged at 55 cents per share. The estimate has moved up 10% over the past 60 days. The consensus mark suggests a year-over-year decline of 26.7%. AEM has an average surprise of 17.9% in the trailing four quarters.

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

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