Fortune Brands Home & Security, Inc.
), the home and security products providing company, is slated to
report second-quarter 2014 results on Jul 30, 2014. In the last
quarter, it posted a negative surprise of 21.87%. Let's see how
things are shaping up for this announcement.
Factors Affecting This Quarter
Despite headwinds like harsh weather and sluggish new
construction activities, Fortune Brands reported a year-over-year
improvement in its financial results for the first quarter of 2014.
Going ahead, this leading home and security products company
believes that it has built an impressive momentum in the last
couple of years and is well placed to boost profits in the
However, we believe this optimism for the rest of the year could
be slightly clouded by second quarter results, wherein the
company's sales might be hurt by weak traffic and macroeconomic
headwinds pertaining to residential remodeling, higher mortgage
rates as well as increased housing prices.
Our proven model does not conclusively show that Fortune Brands
is likely to beat earnings this quarter. This is because a stock
needs to have both a positive
and a Zacks Rank of #1, 2 or 3 for this to happen. This is not the
case here as you will see below.
: Fortune Brands currently has an Earnings ESP of -3.64%. This is
because the Most Accurate estimate stands at 53 cents a share,
while the Zacks Consensus Estimate is pegged at 55 cents per
Zacks Rank #4 (Sell)
: Fortune Brands' Zacks Rank #4 when combined with a negative ESP
makes an earnings beat unlikely. We caution against stocks with a
Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings
announcement, especially when the company is seeing negative
Other Stocks to Consider
Here are some companies you may want to consider as our model
shows they have the right combination of elements to post an
earnings beat this quarter.
Avis Budget Group, Inc. (
) has an Earnings ESP of +3.18% and a Zacks Rank #1 (Strong
Archer Daniels Midland Co. (
) has an Earnings ESP of +5.26% and a Zacks Rank #2 (Buy).
) has an Earnings ESP of +3.47% and a Zacks Rank #2.
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