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What's in the Cards for Kaiser Aluminum (KALU) in Q1 Earnings?

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Kaiser Aluminum (KALU - Free Report) is scheduled to report first-quarter 2024 results on Apr 24, after market close.

Q1 Estimates

The Zacks Consensus Estimate for first-quarter total sales is pegged at $687.4 million, suggesting a decline of around 15% from the year-ago quarter’s reported figure. The consensus mark for the company’s earnings per share is pinned at 58 cents, indicating a decrease of 41% from the 99 cents reported in the first quarter of 2023.

Q4 Performance

Kaiser Aluminium reported an improvement in earnings despite lower revenues in the fourth quarter of 2023. Both the top and bottom lines surpassed the respective Zacks Consensus Estimate. KALU has a trailing four-quarter earnings surprise of 157.2%, on average.

Factors at Play

The company has witnessed robust demand for commercial aerospace applications in recent quarters. This led to record Aerospace / High Strength net sales and conversion revenues in the fourth quarter of 2023 and for 2023 as well.  This positive trend is expected to have boosted the company's top-line performance in the first quarter of 2024, bolstered by customer commitments for commercial jets and strong demand for defense, space and business jets.

However, some of these gains are likely to have been offset by reduced demand for general engineering plate products. Although destocking activity for general engineering long products somewhat stabilized during the fourth quarter of 2023 following five consecutive quarters, it is projected to have persisted into the first quarter of 2024 before returning to normal levels later in the year.

In the Packaging Operations segment, steady demand improvements for both beverage and food products are expected to have been offset by the ongoing destocking of coated food products. While destocking for beverage products stabilized in the latter half of 2023, it persisted for food products and is expected to have continued in some parts of the first quarter of 2024.

Meanwhile, Automotive Extrusions demand is likely to have continued its modest recovery with steady shipments in the first quarter of 2024.

Kaiser Aluminium’s efforts to reduce costs, streamline operations and enhance manufacturing efficiencies are likely to have contributed to margins in the first quarter. However, these gains are expected to have been offset by higher labor and medical costs.

What the Zacks Model Indicates

Our proven model does not conclusively predict an earnings beat for Kaiser Aluminium this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, but that is not the case here.

You can uncover the best stocks before they're reported with our Earnings ESP Filter.

Earnings ESP: Kaiser Aluminium has an Earnings ESP of 0.00%.

Zacks Rank: KALU currently carries a Zacks Rank of 2.

Price Performance

Kaiser Aluminium’s shares have gained 34.6% in the past year compared with the industry’s 26.5% growth.

Zacks Investment Research
Image Source: Zacks Investment Research

Stocks That Warrant a Look

Here are some companies with the right combination of elements to post an earnings beat in their upcoming releases.

Crane Company (CR - Free Report) is scheduled to release its first-quarter 2024 results on Apr 22. It has an Earnings ESP of +0.28% and a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for CR’s first-quarter earnings is pegged at $1.12 per share, which suggests a 10.4% year-over-year decline. It has a trailing four-quarter average surprise of 25.1%.

Eaton Corporation plc (ETN - Free Report) , expected to release earnings soon, has an Earnings ESP of +1.95%.

The Zacks Consensus Estimate for Eaton’s earnings for the first quarter of 2024 is pegged at $2.28 per share, indicating 21.3% year-over-year growth. ETN currently carries a Zacks Rank of 2. It has a trailing four-quarter average surprise of 4.8%.

Ingersoll Rand Inc. (IR - Free Report) , scheduled to release its first-quarter 2024 results on May 2, has an Earnings ESP of +1.82% and a Zacks Rank of 2.

The Zacks Consensus Estimate for Ingersoll Rand’s first-quarter 2024 earnings is pegged at 69 cents per share, which projects 6.2% growth from the year-ago quarter. IR has a trailing four-quarter average surprise of 15.9%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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