The third-quarter earnings season has gathered steam with 87 members of the S&P 500 Index having reported their quarterly numbers, which make up 24.7% of the index’s total market capitalization. Per the latest status as of Oct 20, these companies have put a 9.4% increase in earnings on the back of 7.3% higher sales on the scoreboard. Around 71.3% of these companies delivered positive earnings surprises while 70.1% surpassed revenue expectations. (Read more: Three Takeaways from the Q3 Earnings Season)
This week is going to be a busy one with more than 700 companies in queue to release results, including 180 S&P 500 members. Taking into account all the S&P members that are yet to disclose their numbers, total earnings for the index are expected to be up 2.6% year over year on a 5% increase in revenues in the third quarter. Though this is a deceleration from an 11.2% increase in earnings in the second quarter and 13.6% in the first, growth graph will pick up from the fourth quarter onwards. Per projections, earnings growth will be 9.3% in fourth-quarter 2017, 9.3% in first-quarter 2018, 9.1% in the second and 12.6% in the third quarter of 2018.
The industrial products sector, one of the 16 Zacks sectors, is expected to log growth of 9.2% in third-quarter earnings while revenues will rise 2.9%. It is one of the seven sectors that is anticipated to log positive growth this quarter.
In this write-up, we take a sneak peek into three industrial products stocks that are slated to report their third-quarter results on Oct 24.
One heavyweight that hogs the limelight in the sector is Caterpillar, Inc. (CAT - Free Report) , the world's largest manufacturer of construction and mining equipment. The company will report financial results before the market opens. Caterpillar’s both top and bottom line had improved on a year-over-year basis in the last reported quarter primarily owing to the cost saving activities.
Our proven model shows that the company is likely to beat estimates this quarter. The company has an Earnings ESP of +1.27% as the Most Accurate estimate is $1.24 while the Zacks Consensus Estimate is pegged lower at $1.22. The stock carries a Zacks Rank #2 (Buy), which combined with a positive ESP makes us confident of a positive earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
The company’s earnings have surpassed estimates in the trailing four quarters, with an average positive earnings surprise of 41.4%.
Caterpillar, Inc. Price and EPS Surprise