) is slated to release its first quarter 2012 results before
markets open on May 4, 2012. The Zacks Consensus Estimate for the
first quarter is pegged at 32 cents (year-over-year decline of
83%), while the Zacks Consensus Estimate for the fiscal year 2012
Fourth Quarter and Fiscal 2011 Recap
Total revenue in the quarter increased 10% to $518 million
compared to $470 million in the prior-year period.
For fiscal 2011, the company reported revenues of $2.1 billion,
which was 11% above the prior year with organic growth of 9%
compared to the prior year. The primary driver of revenue growth
was a robust 19% growth in emerging markets and strong growth in
core markets of the company such as oil and gas, transportation and
ITT Corporation released its fourth quarter and full year 2011
earnings results and reported quarterly earnings per share from
continuing operations of $0.36, which was a penny above the Zacks
For the full year the company reported earnings of $1.60,
reflecting a 23% increase compared to the prior -year period,
driven by strong revenue growth and operating performance.
Agreement of Estimate Revisions
Over the past seven days, all the analysts covering ITT were
Neutral about the quarterly estimates.
For fiscal 2012 as well, over the last seven days, all the
analysts covering ITT were again Neutral about their estimates.
We believe analysts continue to expect margins to be under
pressure due to high incremental costs involved after the
transformation to be a stand-alone company. However, the company is
positive about its performance in fiscal 2012 with EPS growth of
13% after adjusting for the incremental stand alone costs worth $20
million. Therefore, the analysts probably intend to wait and see
the performance moving forward.
Magnitude of Estimate Revisions
Over the past seven days, the Zacks Consensus Estimate has
remained unchanged at 32 cents for the current quarter. For fiscal
2012 as well, the estimate was unchanged at $1.67 a share.
ITT has surpassed the Zacks earnings estimates in three of the
last four quarters. The earnings surprise range from a low
of a negative 0.85% to a high of positive 5.38%, with the
average earnings surprise being a positive 2.28%.
The company continues to make investments in attractive growth
areas such as air traffic management, emerging market expansion,
product innovation, defense adjacency, diversity strategy and
We are particularly bullish about two segments: a) water
equipment (primarily pumps), which should benefit from the
replacement and upgrading of aging networks in developed markets
and the build out of infrastructure in the emerging markets, and b)
ITT's defense business, with the bulk of sales derived from
electronic and network-centric warfare.
ITT Corporation continues to expand its product portfolio and
geographical presence while making a number of strategic
acquisitions. The acquisition of Godwin Pumps broadened the
company's global position in water, wastewater and industrial
processes, and compliments ITT's existing Fluid Technology
The company is particularly focused on its presence in the
emerging markets. The acquisition of Canberra Pumps increased its
footprint in Latin America, enabling it to provide more products to
the growing oil and gas and mining markets there.
The company currently holds a Zacks Rank #3 which implies a
short term Hold rating on the stock.
ITT CORP (ITT): Free Stock Analysis Report
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