) is slated to release its third-quarter fiscal 2012 earnings
results on Wednesday, June 6, 2012. The current Zacks Consensus
Estimate for third-quarter earnings per share (EPS) is 79 cents,
representing annualized growth of 10.19%.
Pall's earnings were above the Zacks Consensus Estimates in the
second and first quarters of fiscal 2012 and in the fourth quarter
of fiscal 2011. Earnings, however, missed the forecast in the third
quarter of fiscal 2011. The company's average positive earnings
surprise for the trailing four quarters is 1.08%.
Second Quarter Highlights
Pall Corporation reported second-quarter fiscal 2012 earnings
per share from continuing operations of 76 cents, below the Zacks
Consensus Estimate of 82 cents, but above the prior-year earnings
per share of 68 cents.
Total revenue in the quarter increased by 8.2% year over year to
$698 million, including a positive impact from foreign currency
translation of 0.2%. Orders, in terms of local currency, increased
by 3.4%. Revenue, in the quarter, was aided by increased sales in
both Life Sciences and Industrial segments. Emerging markets were a
good contributor, with sales rising by 20%.
Segment-wise, Life Sciences revenues climbed by 7% in local
currency to $357.2 million while Industrial revenues rose 9.2% in
local currency to $340.8 million.
Agreement of Estimate Revisions
In the last 7 days, none of the analysts has increased or
decreased their estimates. However, in the last 30 days, one
analyst decreased the estimate for the third and fourth quarters of
fiscal 2012 and for full year fiscal 2012, while another increased
the estimate for full year fiscal 2013.
The analysts believe that in the long term, Pall will likely
benefit from several secular trends, such as global infrastructure
growth, increasing demand for water filtration systems, and
continued steady growth in medical and pharmaceutical
However, their optimism regarding the company's long-term
potential is tampered somewhat by several near-term concerns,
including depressed demand in industrial end-markets, volatility in
gross margin, and ongoing restructuring charges. Although
PLL's cyclical end markets are on the road to recovery, a rebound
is expected to be slower than originally anticipated.
Magnitude of Estimate Revisions
Consensus earnings estimates have hit a plateau over the last 7
days for the third and fourth quarters of 2012 as well as for
fiscal 2012 and 2013. In the last 30 days, fourth quarter 2012
estimate has decreased by a penny to 89 cents while the estimate
for fiscal 2013 has increased by a penny to $3.54.
The company is deriving significant benefit from the emerging
markets, including Latin America, MENA, China, India and Southeast
Asia. Though the company continues to see business disruptions in
Japan in the short term, on a long-term basis, it sees
opportunities with the world's third largest economy as they
Pall will further benefit from several secular trends, such as
global infrastructure growth, increasing demand for water
filtration systems and continued steady growth in the medical and
However, the company derives a major portion of its revenue from
outside the U.S. Operating results may be materially affected by
changes in foreign currency rates. During the second quarter
Medical sales (a sub-component of Life Sciences) declined by 0.6%
while order declined by 6%. Hospital sales were also hit by 10%
owing to inventory reductions at customers and supply related
Pall Corporation is a leading supplier of filtration, separation
and purification technologies, using its engineering capability and
fluid management expertise, proprietary filter media and other
fluid clarification and separations equipment for the removal of
solid, liquid and gaseous contaminants from a wide variety of
liquids and gases.
We continue to maintain a Neutral rating on Pall Corporation
System for the long term. The company has a Zacks #3 Rank (Hold
recommendation) over the next one-to-three months.
PALL CORP (PLL): Free Stock Analysis Report
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