Leggett & Platt Inc.
) is set to report third-quarter fiscal 2013 results on Oct 23.
Last quarter, the company's earnings were in line with
expectations. Let's see how things are shaping up for this
Recent Growth Drivers
Leggett's second-quarter earnings were 13.0% higher than the
year-ago quarter. The earnings upside mainly resulted from solid
sales and comps performance at the company's stores. The
company's comps benefited from a rise in unit volumes and
positive impact from acquisitions, partly offset by declining rod
mill trade sales.
Moreover, net sales grew 3% year over year driven by improved
sales at all the segments. Gross profit grew year over year
mainly due to higher sales, partly offset by a rise in the cost
of goods sold.
On the earnings call, the company provided fiscal 2013 earnings
and sales expectations. The company expects fiscal 2013 earnings
per share in the range of $1.50-$1.65, while sales are projected
to increase 1%-4% to $3.75-$3.85 billion. The current Zacks
Consensus Estimate is pegged at $1.56 per share.
Our proven model does not conclusively show that Leggett 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.
ESP for Leggett is 0.00% since the Most Accurate Estimate stands
at 44 cents, which is in line with the Zacks Consensus Estimate.
Zacks Rank #2 (Buy):
Leggett's Zacks Rank #2 (Buy) has little effect on the predictive
power of ESP because the Zacks Rank #2 when combined with a 0.00%
ESP makes surprise prediction difficult.
We caution against stocks with Zacks Rank #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 you may want to consider as our
model shows that they have the right combination of elements,
i.e., a positive Zacks Earnings ESP and a Zacks Rank #1, #2 or
Best Buy Co. Inc.
) with an Earnings ESP of +30.00% and a Zacks Rank #2 (Buy).
) with an Earnings ESP of +2.59% and a Zacks Rank #2 (Buy).
Dollar General Corp.
) has an Earnings ESP of +1.41% and a Zacks Rank #2 (Buy).
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LEGGETT & PLATT (LEG): Free Stock Analysis
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