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What's in Store for Flexible Solutions (FSI) in Q2 Earnings?

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Flexible Solutions International Inc. (FSI - Free Report) is slated to release its second-quarter 2019 results after the bell on Aug 14.

The company has delivered average negative earnings surprise of 41.4% over the trailing four quarters.

Shares of Flexible Solutions have surged around 148.9% year to date, outperforming the industry’s rise of roughly 15.5%.


 

Let’s see how things are shaping up for this announcement.

Some Factors at Play

Flexible Solutions, last month, announced a year over year increase in revenues for the quarter to be reported. It reported revenues of around $6.76 million for the quarter, up roughly 63% year over year. The company said that the results could have been even better if not for the poor spring weather in the central United States.

The Zacks Consensus Estimate for revenues for Flexible Solutions for the second quarter is $8.4 million, reflecting an expected increase of roughly 102% on a year-over-year basis.

The ENP acquisition is expected to drive the company’s revenues in the second quarter. The buyout has provided the company with opportunities for improving its products and boosted its exposure to the important golf, turf and ornamental market. Flexible Solutions is also expected to benefit from actions to grow internal sales. However, the company is exposed to headwind from higher raw material costs, which may affect its margins in the quarter.

Zacks Model

Our proven model does not show that Flexible Solutions is likely to beat estimates this quarter. That is because a stock needs to have 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 you will see below:

Earnings ESP: Earnings ESP for Flexible Solutions is 0.00%. The Zacks Consensus Estimate for the second quarter is currently pegged at 6 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Flexible Solutions currently carries a Zacks Rank #2, which when combined with a 0.00% ESP, makes surprise prediction difficult.  

Note that we caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks That Warrant a Look

Here are some companies that you may want to consider as our model shows that they have the right combination of elements to post a beat this time around:

Aurora Cannabis Inc. (ACB - Free Report) has an Earnings ESP of +50.00% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Evolus, Inc. (EOLS - Free Report) has an Earnings ESP of +27.75% and carries a Zacks Rank #3.

IAA, Inc. (IAA - Free Report) has an Earnings ESP of +4.40% and a Zacks Rank #3.

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