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What's in Store for Rockwell Automation's (ROK) Q3 Earnings?
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Rockwell Automation Inc. (ROK - Free Report) is scheduled to report third-quarter fiscal 2020 results, before market open on Jul 28.
Q3 Estimates
The Zacks Consensus Estimate for third-quarter fiscal 2020 revenues is pegged at $1.39 billion, indicating a decline of 16.5%, year on year. The same for the quarter’s earnings is pinned at $1.13 per share, suggesting a plunge of 53% from the prior-year reported figure. The figure has moved north over the past 30 days.
Let’s see how things have shaped up prior to this announcement.
Our proven model predicts an earnings beat for Rockwell Automation this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Rockwell Automation is +7.26%. This is because currently the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $1.22 per share and $1.13, respectively.
Zacks Rank: Rockwell Automation currently carries a Zacks Rank #2.
Factors to Consider
Rockwell Automation serves discrete end markets, including automotive, semiconductor and general industries. Consequently, the overall slowdown in the U.S manufacturing sector primarily due to the coronavirus pandemic might have thwarted demand for its products. Per the Institute for Supply Management’s report, the U.S Purchasing Managers’ Index (PMI) came in at 41.5% for April — the lowest since April 2009 when it registered 39.9%. In May, the PMI came in at 43.1%. A reading below 50 denotes contraction. Even though the index has climbed to 52.6% in June, overall for the second quarter, the manufacturing index averaged 45.7%. A weak manufacturing backdrop, uncertainty in the market and cautious customer spending was further aggravated by the pandemic during the June-end quarter.
Material cost inflation is likely to have affected Rockwell Automation’s margins in the quarter to be reported. However, focus on productivity and initiatives to mitigate the impact of tariffs are anticipated to have aided the company during the period in discussion.
Rockwell Automation announced temporary cost-containment measures in the wake of weak demand and uncertain market conditions due to the pandemic. Also, the company is taking preemptive actions to align its cost structure with the current turbulent economic environment.
Soaring demand for packaged food and beverages amid travel restrictions imposed by governments all over are likely to have contributed to Rockwell Automation's Food & Beverage business in the fiscal third quarter. Moreover, the company’s focus on expanding hardware and software products as well as solutions and services through share gains in core platforms, double-digit growth in Information Solutions and Connected Services segment, as well as contribution from acquisitions and inorganic investments are likely to have contributed to quarterly performance.
How Will The Segments Fare?
The Zacks Consensus Estimate for the Architecture & Software segment’s net sales is pegged at $600 million in the fiscal third quarter, a decline of 19.8% from the year-ago quarter. The Zacks Consensus Estimate for the segment’s operating profit is pegged at $142 million, suggesting a decline of 36.3% from the prior-year quarter.
The Zacks Consensus Estimate for the Control Products & Solutions segment’s revenues is pegged at $777 million, suggesting a year-over-year fall of 15.3%. The Zacks Consensus Estimate for the segment’s operating profit is pinned at $80 million, indicating a decline of 53.7% from the year-ago quarter reported figure.
Share Price Performance
Over the past year, Rockwell Automation’s shares have gained 29.8%, outperforming the industry’s growth of 29.4%.
Stocks Poised to Beat Earnings Estimates
Here are a few Industrial Products stocks, which you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
Lincoln Electric Holdings, Inc. (LECO - Free Report) currently carries a Zacks Rank #2 and has an Earnings ESP of +5.50%.
Packaging Corporation of America (PKG - Free Report) , a Zacks #3 Ranked stock, has an Earnings ESP of +7.03%.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in Store for Rockwell Automation's (ROK) Q3 Earnings?
Rockwell Automation Inc. (ROK - Free Report) is scheduled to report third-quarter fiscal 2020 results, before market open on Jul 28.
Q3 Estimates
The Zacks Consensus Estimate for third-quarter fiscal 2020 revenues is pegged at $1.39 billion, indicating a decline of 16.5%, year on year. The same for the quarter’s earnings is pinned at $1.13 per share, suggesting a plunge of 53% from the prior-year reported figure. The figure has moved north over the past 30 days.
Let’s see how things have shaped up prior to this announcement.
Rockwell Automation, Inc. Price and EPS Surprise
Rockwell Automation, Inc. price-eps-surprise | Rockwell Automation, Inc. Quote
What Our Model Indicates
Our proven model predicts an earnings beat for Rockwell Automation this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Rockwell Automation is +7.26%. This is because currently the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at $1.22 per share and $1.13, respectively.
Zacks Rank: Rockwell Automation currently carries a Zacks Rank #2.
Factors to Consider
Rockwell Automation serves discrete end markets, including automotive, semiconductor and general industries. Consequently, the overall slowdown in the U.S manufacturing sector primarily due to the coronavirus pandemic might have thwarted demand for its products. Per the Institute for Supply Management’s report, the U.S Purchasing Managers’ Index (PMI) came in at 41.5% for April — the lowest since April 2009 when it registered 39.9%. In May, the PMI came in at 43.1%. A reading below 50 denotes contraction. Even though the index has climbed to 52.6% in June, overall for the second quarter, the manufacturing index averaged 45.7%. A weak manufacturing backdrop, uncertainty in the market and cautious customer spending was further aggravated by the pandemic during the June-end quarter.
Material cost inflation is likely to have affected Rockwell Automation’s margins in the quarter to be reported. However, focus on productivity and initiatives to mitigate the impact of tariffs are anticipated to have aided the company during the period in discussion.
Rockwell Automation announced temporary cost-containment measures in the wake of weak demand and uncertain market conditions due to the pandemic. Also, the company is taking preemptive actions to align its cost structure with the current turbulent economic environment.
Soaring demand for packaged food and beverages amid travel restrictions imposed by governments all over are likely to have contributed to Rockwell Automation's Food & Beverage business in the fiscal third quarter. Moreover, the company’s focus on expanding hardware and software products as well as solutions and services through share gains in core platforms, double-digit growth in Information Solutions and Connected Services segment, as well as contribution from acquisitions and inorganic investments are likely to have contributed to quarterly performance.
How Will The Segments Fare?
The Zacks Consensus Estimate for the Architecture & Software segment’s net sales is pegged at $600 million in the fiscal third quarter, a decline of 19.8% from the year-ago quarter. The Zacks Consensus Estimate for the segment’s operating profit is pegged at $142 million, suggesting a decline of 36.3% from the prior-year quarter.
The Zacks Consensus Estimate for the Control Products & Solutions segment’s revenues is pegged at $777 million, suggesting a year-over-year fall of 15.3%. The Zacks Consensus Estimate for the segment’s operating profit is pinned at $80 million, indicating a decline of 53.7% from the year-ago quarter reported figure.
Share Price Performance
Over the past year, Rockwell Automation’s shares have gained 29.8%, outperforming the industry’s growth of 29.4%.
Stocks Poised to Beat Earnings Estimates
Here are a few Industrial Products stocks, which you may consider as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases:
Allegion plc (ALLE - Free Report) has an Earnings ESP of +2.27% and carries a Zacks Rank of 2, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.
Lincoln Electric Holdings, Inc. (LECO - Free Report) currently carries a Zacks Rank #2 and has an Earnings ESP of +5.50%.
Packaging Corporation of America (PKG - Free Report) , a Zacks #3 Ranked stock, has an Earnings ESP of +7.03%.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>