Can Ametek Inc. (AME) Surprise This Earnings Season? - Analyst Blog


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Ametek Inc. ( AME ) is set to report second-quarter 2014 results on Aug 5. Last quarter, it posted a 1.8% positive surprise. Let's see how things are shaping up for this announcement.

Growth Factors This Past Quarter

Ametek reported better-than-expected first quarter results with both the top and bottom lines surpassing the Zacks Consensus Estimate. Sales were up 10% from the year-ago quarter, primarily driven by solid execution of its four growth strategies. Additionally, strong core growth in combination with enhanced operational performance and positive synergies from recent acquisitions helped the company deliver strong results.

Ametek recently completed the acquisition of Zygo Corporation, a provider of optical metrology solutions, high precision optics, and optical assemblies, which can be utilized across a broad range of scientific, manufacturing, and medical applications. The acquisition will be merged in its Ultra Precision Technologies Division within the Electronic Instruments Group. The acquisition will further ramp up Ametek's product line, strengthen its market position and boost the bottom line through revenue growth and effective operational activities.

The company believes that strong execution of its four core growth strategies of operational excellence, global market expansion, new product development, and strategic acquisitions will continue to play an important role in driving its growth. This in combination with its excellent backlog and strong portfolio of businesses will help the company post better results in the upcoming quarter.

Earnings Whispers?

Our proven model does not conclusively show that Ametek will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP : Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 59 cents. Hence, the difference is 0.00%.

Zacks Rank : Ametek's Zacks Rank #3 (Hold), when combined with a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies, which you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

  • Charter Communications, Inc. ( CHTR ), with Earnings ESP of +271.43% and a Zacks Rank #1 (Strong Buy)
  • Cognex Corp. ( CGNX ), with Earnings ESP of +12.00% and a Zacks Rank #1
  • Semiconductor Manufacturing International Corp. ( SMI ), with Earnings ESP of +33.33% and a Zacks Rank #2 (Buy)

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AMETEK INC (AME): Free Stock Analysis Report

CHARTER COMM-A (CHTR): Free Stock Analysis Report

COGNEX CORP (CGNX): Free Stock Analysis Report

SEMICON MFG-ADR (SMI): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Earnings , Stocks
More Headlines for: AME , CHTR , CGNX , SMI

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