Back to top

Analyst Blog

Zacks Equity Research

Machinery Stocks to Watch for Earnings on Nov 8: MIDD & ZBRA

MIDD ZBRA

Trades from $3

The third-quarter earnings season is well into the second half of the reporting cycle with more than 423 S&P 500 companies having already reported results till Nov 4. We notice that results in the third quarter have improved remarkably from the preceding quarters and would likely end up being in the optimistic territory after five repeated seasons of earnings decline for the benchmark index.

However, while estimating the performance of U.S.-based machinery stocks, we believe that factors like election-induced market instability, a strong U.S. dollar, weak energy resource prices, lackluster export numbers of China and the Brexit referendum might act as spoilsport.

Nevertheless, the time isn’t ripe to draw any concrete conclusion, as the actual results might hold surprises.

According to the Zacks Industry classification, the machinery industry is broadly grouped under Industrial Products, one of the 16 Zacks sectors.

Below we briefly discuss the broader sectors’ earnings trend so far for the Jul–Sep 2016 quarter.

Our latest Earnings Preview article (released on Nov 4, 2016) reveals that roughly 87% of the Industrial stocks in the S&P 500 Group have reported results for the July-September quarter, recording 4.1% rise in earnings and 3% decline in revenues on a year-over-year basis. We predict that earnings of all the industrial stocks in the S&P 500 Group will increase 7.2% year over year. However revenues are expected to inch down 0.3% over the same time frame.

What Awaits these 2 Machinery Stocks?

Middleby Corp. (MIDD - Free Report) is slated to report third-quarter 2016 results on Nov 8. The company’s average positive earnings surprise over the last four trailing quarters is 9.22%. Our proven model does not conclusively show that Middleby will beat estimates in 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 an earnings beat. That is not the case here as we will see below.

Middleby’s Earnings ESP is 0.00%, as the Most Accurate estimate is in line with the Zacks Consensus Estimate of $1.25 per share. The company carries a favorable Zacks Rank #3, but when combined with a 0.00% ESP, it makes surprise predictions difficult. You can see the complete list of today’s Zacks #1 Rank stocks here.

MIDDLEBY CORP Price and EPS Surprise

 

MIDDLEBY CORP Price and EPS Surprise | MIDDLEBY CORP Quote

Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.

Over the last seven days, the Zacks Consensus Estimate for the stock has remained stable at $1.25 per share. 

Zebra Technologies Corporation (ZBRA - Free Report) is scheduled to report its third-quarter 2016 earnings. The company’s average positive earnings surprise over the last four trailing quarters is 12.11%. Our proven model estimates that the company is likely to beat earnings this quarter because it has the right combination of two key ingredients. The company carries a Zacks Rank #3 and has an Earnings ESP of 0.76%. Over the last seven days, the Zacks Consensus Estimate for the stock has remained constant at $1.31 per share.

ZEBRA TECH CL A Price and EPS Surprise

 

ZEBRA TECH CL A Price and EPS Surprise | ZEBRA TECH CL A Quote

We caution against stocks with Zacks Rank #4 or #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing a negative estimate revision momentum.

Confidential: Zacks' Best Investment Ideas  

Would you like to see a hand-picked ""all-star"" selection of investment ideas from the man who heads up Zacks' trading and investing services? Steve Reitmeister knows when key trades are about to be triggered and which of our experts has the hottest hand. Click for his selected trades right now >>    
 


In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

MIDDLEBY CORP (MIDD) - free report >>

ZEBRA TECH CL A (ZBRA) - free report >>