SWK, ROP Q1 Earnings on Apr 20: Here Are the Key Predictions
The January-March quarter of 2018 was eventful for U.S. equity investors. Positive reactions followed the Trump government’s announcement of the U.S. Tax Cuts and Jobs Act passed last December. Soon after that, fears of inflation and imposition of import tariffs of 25% on steel and 10% on aluminum stalled the positive momentum. Then, the recent joint attack by the United States, Britain and France on Syria rocked the world, leaving many pondering over its possible after effects.
Notwithstanding these issues, equity investors must closely follow the financial releases for the first quarter of 2018. Though results of some banking stocks failed to impress the market, we believe that important releases, slated for this week and the next, will be a major determinant of the movements in the U.S. equity market.
Per our in-house classifications, the U.S. equity universe is grouped into 16 sectors. The projections, as published in the Earnings Trends report on Apr 18, calls for 17.8% year-over-year growth in earnings of the S&P 500 companies in the first quarter. Collectively, revenues of these companies are predicted to rise 7.6% and margins to grow 1%.
As of Apr 18, roughly 10.4% of the S&P 500 companies have reported their results. The performance so far is impressive, with year-over-year earnings growth of 27.9% and revenue growth of 10.7%. Beat was measured at 84.6% for earnings and 78.8% for revenues.
We believe that it will be interesting to watch how the earnings season unfolds for the Industrial Products sector. It currently occupies the first position in the Zacks sectors list.
Performance So Far & Projections for Industrial Products
Till Apr 18, 4.2% of the Industrial Products companies reported results for this season. With a beat of 100%, earnings increased 26.2% while revenues grew 24% compared with the year-ago tally.
With bulk earnings yet to come, Industrial Products’ earnings are predicted to grow 24.4% year over year in the first quarter. Revenues are anticipated to increase 12.5% and margins are projected to expand 0.9%.
Despite the turbulence in the market, we believe that many positive factors during the quarter must have supported growth for the industrial companies. Of many, trends indicating an expanding manufacturing sector, rising new orders for U.S.-made machinery, strengthening job market as evident from a 17-year low unemployment rate of 4.1% in March and 4.5% growth in industrial products in the first quarter are worth mentioning.
What’s in Store for 2 Industrial Stocks: SWK & ROP?
Below, we discuss briefly the expectations from the two industrial stocks slated to report their numbers for the first quarter tomorrow, before the market opens.
Stanley Black & Decker, Inc. SWK: This industrial tool maker delivered better-than-expected results in the last four quarters, pulling off an average positive earnings surprise of 4.28%.
Stanley Black & Decker, Inc. Price, Consensus and EPS Surprise
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Roper Technologies, Inc. (ROP): Free Stock Analysis Report
Stanley Black & Decker, Inc. (SWK): Free Stock Analysis Report
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