Agilent Technologies Inc.
) to beat expectations when it reports fiscal second quarter 2014
results on May 14.
Why a Likely Positive Surprise?
Our proven model shows that Agilent is likely to beat estimates
because it has the right combination of two key ingredients.
Positive Zacks ESP:
Earnings Surprise Prediction or
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is at +1.39%. This is
very meaningful and a leading indicator of a likely positive
earnings surprise for shares.
Zacks Rank #2 (Buy):
Note that stocks with Zacks Ranks of #1, 2 and 3 have a
significantly higher chance of beating estimates. The Sell-rated
stocks (#4 and 5) should never be considered going into an earnings
The combination of Agilent's Zacks Rank #2 and +1.39% ESP makes
us very confident about an earnings beat on May14.
What is Driving the Better Than Expected Earnings?
Agilent's introduction of new products and solutions (with
higher margins), important acquisitions in areas like life
sciences, genomics, diagnostics and wireless test markets are
expected to lead to a positive earnings surprise in the upcoming
Moreover, Agilent's recent acquisition of Electrothermal
Analysis Technology from Gradient Design Automation will enhance
its power to identify and solve thermal problems during integrated
circuit (IC) development. Thus, the acquisition makes Agilent the
owner of highly efficient technology that can solve an important
industry problem. Thus, the deal is expected to be accretive to
both margins and earnings.
The positive trend is also seen in the trailing four-quarter
average positive surprise of 8.2%, which was greatly helped by the
1.5% surprise in the last-reported quarter.
Other Stocks to Consider
Agilent is not the only firm looking up this earnings season. We
also see likely earnings beats coming from these 3 technology
), with Earnings ESP of +1.18% and a Zacks Rank #2 (Buy)
), with Earnings ESP of +33.33% and a Zacks Rank #2.
), with Earnings ESP of +17.86% and a Zacks Rank #2.
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