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Ball Corp (BALL) to Report Q2 Earnings: What's in Store?

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Ball Corporation (BALL - Free Report) is scheduled to report second-quarter 2023  results on Aug 3, before the opening bell.

Q1 Performance

In the last reported quarter, Ball Corp’s earnings and revenues declined year over year. While earnings beat the Zacks Consensus Estimate, revenues missed the same. BALL missed the Zacks Consensus Estimate in three of the four trailing quarters and topped in one, the average surprise being 3%.

Ball Corporation Price and EPS Surprise

 

Ball Corporation Price and EPS Surprise

Ball Corporation price-eps-surprise | Ball Corporation Quote

Q2 Estimates

The Zacks Consensus Estimate for BALL’s second-quarter earnings per share is pegged at 60 cents, suggesting a decline of 26.8% from the prior-year quarter’s reported levels. The Zacks Consensus Estimate for total sales is pegged at $3.8 billion, indicating a year-over-year decline of 7.5%.

Factors to Note

Ball Corp has lately been witnessing  weaker-than-expected demand, as customer spending has been muted amid higher retail prices, particularly in the United States. This is likely to get reflected in the company’s second-quarter results. High input and labor costs due to supply constraints are anticipated to have impacted the company’s performance in the quarter.

Higher-than-expected start-up costs, stemming from capacity expansion measures, are also likely to have dented the margin performance. However, BALL has been focused on improving its efficiency and reducing costs, which is likely to have negated these impacts and aided margins in the to-be-reported quarter.

Our estimate for the Beverage packaging, North and Central America segment’s net sales is pegged at $1,5978 million for the June-end quarter, indicating a 10% year-over-year decline. The segment’s operating income is estimated at $185 million, suggesting growth of 12.8% from the prior-year quarter’s actual. The segment’s performance is expected to have been impacted by the weakness in demand as mentioned above, and inflated raw material and manufacturing costs. We expect the segment’s volume to fall 5.4% in the quarter.

The Beverage Packaging, EMEA segment’s second-quarter 2023 results will likely reflect the impacts of higher inflation, energy costs and supply-chain disruptions across the region.

Our model predicts the Beverage Packaging , Europe segment’s sales to be $1007 million for the to-be-reported quarter, indicating an 11.1% drop from the prior-year quarter’s reported figure. The segment’s operating income is projected at $114 million, suggesting an 11.3% year-over-year plunge.

Elevated costs are likely to have impacted the segment’s profits in the quarter under review. However, focus on reducing costs will help partially negate these headwinds. We expect volume growth of 3.8% for this segment.

We expect the Beverage Packaging, South America segment’s net sales to be $486 million, suggesting a 9% fall from the year-ago period’s reported levels. The consensus estimate for the segment’s operating income is pegged at $47 million, suggesting a 9.8% decline from the prior-year quarter’s reported level. Our model predicts a volume decrease of 2% for the segment.

Our estimate for the Aerospace segment's revenues is pegged at $500 million for the period under discussion, indicating a year-over-year improvement of 2%. The segment has been winning defense, climate change and Earth-monitoring contracts to provide mission-critical programs and technologies to the U.S. government, defense, intelligence, reconnaissance and surveillance customers. 

However, the segment is expected to have witnessed the impacts of supply-chain inefficiencies. The segment’s operating income is projected at $46 million, suggesting 27.8% growth from the prior-year quarter’s reported figure.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Ball Corp this time around. 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.

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

Earnings ESP: BALL has an Earnings ESP of -0.17%.

Zacks Rank: Currently, the company carries a Zacks Rank of 3.

Price Performance

Shares of Ball Corp have fallen 19.7% in the past year compared with the industry's 13.3% decline.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Stocks to Consider

Here are some Industrial Products stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases.

Terex Corporation (TEX - Free Report) , set to report earnings on Aug 1, has an Earnings ESP of +2.14% and a Zacks Rank of 2 at present. You can see the complete list of today's Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Terex’s fiscal second-quarter earnings is pegged at $1.61 per share, suggesting a year-over-year improvement of 50.5%. The company has a trailing four-quarter surprise of 27.1%, on average.

Eaton Corporation plc (ETN - Free Report) , set to release earnings on Aug 1, currently has an Earnings ESP of +0.36% and a Zacks Rank of 2.

The consensus estimate for ETN’s earnings for the second quarter is pegged at $2.11 per share. The company has a trailing four-quarter surprise of 2.5%, on average.

Illinois Tool Works (ITW - Free Report) , set to release earnings on Aug 1, has an Earnings ESP of +0.54% and a Zacks Rank of 3 at present.

The Zacks Consensus Estimate for ITW’s second-quarter earnings is pegged at $2.36 per share, suggesting a year-over-year improvement of 0.8%. The company has a trailing four-quarter surprise of 2.1%, on average.

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

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