Back to top

Image: Bigstock

Why Earnings Season Could Be Great for Illinois Tool (ITW)

Read MoreHide Full Article

Investors are always looking for stocks that are poised to beat at earnings season and Illinois Tool Works Inc. (ITW - Free Report) may be one such company. The firm has earnings coming up pretty soon, and events are shaping up quite nicely for their report.

That is because Illinois Tool is seeing favorable earnings estimate revision activity as of late, which is generally a precursor to an earnings beat. After all, analysts raising estimates right before earnings — with the most up-to-date information possible — is a pretty good indicator of some favorable trends underneath the surface for ITW in this report.

In fact, the Most Accurate Estimate for the current quarter is currently at $1.90 per share for ITW, compared to a broader Zacks Consensus Estimate of $1.88 per share. This suggests that analysts have very recently bumped up their estimates for ITW, giving the stock a Zacks Earnings ESP of +0.56% heading into earnings season.

Illinois Tool Works Inc. Price and EPS Surprise

Illinois Tool Works Inc. Price and EPS Surprise

Why is this Important?

A positive reading for the Zacks Earnings ESP has proven to be very powerful in producing both positive surprises, and outperforming the market. Our recent 10-year backtest shows that stocks that have a positive Earnings ESP and a Zacks Rank #3 (Hold) or better show a positive surprise nearly 70% of the time, and have returned over 28% on average in annual returns (see more Top Earnings ESP stocks here).

Given that ITW has a Zacks Rank #3 and an ESP in positive territory, investors might want to consider this stock ahead of earnings. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Clearly, recent earnings estimate revisions suggest that good things are ahead for Illinois Tool, and that a beat might be in the cards for the upcoming report.

These Stocks Are Poised to Soar Past the Pandemic

The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.

Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.

See the 5 high-tech stocks now>>


See More Zacks Research for These Tickers


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


Illinois Tool Works Inc. (ITW) - free report >>

Published in