We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Q3 Earnings Hold a Surprise for Xylem (XYL) Stock?
Read MoreHide Full Article
Xylem Inc. (XYL - Free Report) is scheduled to report its third-quarter 2016 figures before the market opens on Nov 1, 2016.
Let’s see how things are shaping up prior to this announcement.
Existing Scenario
After reporting robust results for the first half of 2016, Xylem believes that consistently rising demand for water infrastructure and wastewater services would improve its revenues and margins in the upcoming quarter. Moreover, the company’s strategic approach toward project execution and lately, new inorganic investments, are anticipated to bear fruit in the to-be-reported quarter. For instance, acquisition of Tideland Signal Corporation in Feb 2016 is expected to supplement Xylems’ sales in the coastal and ocean markets. Furthermore, the company believes that the initiatives undertaken to curb operational costs would help in expanding its margins going ahead.
However, our observations indicate that the company might fail to surprise in third-quarter earnings due to certain headwinds. For instance, lower investments made by energy and mining companies may hurt the demand for industrial services offered by Xylem. Also, further strengthening of U.S. currency might lower foreign revenues and earnings in the upcoming quarterly results.
Earnings Whispers
Our proven model does not conclusively show that Xylem is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as we will see below.
Zacks ESP: Xylem currently has an Earnings ESP of 0.00%. This is because both the Zacks Consensus Estimate and the Most Accurate estimate are pegged at 53 cents.
Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
Note that we caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Other Stocks that Warrant a Look
Here are some other stocks within the industry that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat:
Casella Waste Systems Inc. (CWST - Free Report) , with an Earnings ESP of +60.00% and a Zacks Rank #1.
Ball Corporation , with an Earnings ESP of +5.44% and a Zacks Rank #2.
Cintas Corporation (CTAS - Free Report) , with an Earnings ESP of +0.87% and a Zacks Rank #2.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Will Q3 Earnings Hold a Surprise for Xylem (XYL) Stock?
Xylem Inc. (XYL - Free Report) is scheduled to report its third-quarter 2016 figures before the market opens on Nov 1, 2016.
Let’s see how things are shaping up prior to this announcement.
Existing Scenario
After reporting robust results for the first half of 2016, Xylem believes that consistently rising demand for water infrastructure and wastewater services would improve its revenues and margins in the upcoming quarter. Moreover, the company’s strategic approach toward project execution and lately, new inorganic investments, are anticipated to bear fruit in the to-be-reported quarter. For instance, acquisition of Tideland Signal Corporation in Feb 2016 is expected to supplement Xylems’ sales in the coastal and ocean markets. Furthermore, the company believes that the initiatives undertaken to curb operational costs would help in expanding its margins going ahead.
However, our observations indicate that the company might fail to surprise in third-quarter earnings due to certain headwinds. For instance, lower investments made by energy and mining companies may hurt the demand for industrial services offered by Xylem. Also, further strengthening of U.S. currency might lower foreign revenues and earnings in the upcoming quarterly results.
Earnings Whispers
Our proven model does not conclusively show that Xylem is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. That is not the case here as we will see below.
Zacks ESP: Xylem currently has an Earnings ESP of 0.00%. This is because both the Zacks Consensus Estimate and the Most Accurate estimate are pegged at 53 cents.
Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
XYLEM INC Price and EPS Surprise
XYLEM INC Price and EPS Surprise | XYLEM INC Quote
Zacks Rank: Xylem carries a Zacks Rank #3. However, a 0.00% ESP makes surprise prediction difficult. You can see the complete list of today’s Zacks #1 Rank stocks here.
Note that we caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Other Stocks that Warrant a Look
Here are some other stocks within the industry that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat:
Casella Waste Systems Inc. (CWST - Free Report) , with an Earnings ESP of +60.00% and a Zacks Rank #1.
Ball Corporation , with an Earnings ESP of +5.44% and a Zacks Rank #2.
Cintas Corporation (CTAS - Free Report) , with an Earnings ESP of +0.87% and a Zacks Rank #2.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>