Technical service provider
CACI International Inc.
) is scheduled to report its fourth-quarter and fiscal 2014 results
after the closing bell on Aug 20. In the last reported quarter,
CACI recorded lackluster results with adjusted earnings missing the
Zacks Consensus Estimate by a couple of cents. Let's see how things
are shaping up for this announcement.
Key Factors in the Fourth Quarter
CACI expects reduced government spending and delays in contract
awards to continue to adversely affect its soon-to-be-reported
quarter and fiscal 2014 results. In April this year, CACI trimmed
its revenue outlook for fiscal 2014 to a range of $3.5 billion and
$3.6 billion from $3.6 billion-$3.8 billion. The lower fiscal
revenue outlook was primarily driven by delayed accrual of new
businesses, lower run-rates on professional services contracts and
reductions in Afghanistan-related material purchases.
At the same time, CACI revised its net income outlook for fiscal
2014 to a range of $130-$140 million from $142-$152 million
expected earlier. The fiscal earnings guidance was truncated to
$5.12-$5.51 per share from the previous range of $5.59-$5.98.
However, fourth quarter net income is expected to be higher
sequentially, driven by higher award fees, greater contributions by
Six3 Systems, increased volume of high margin product sales,
modestly higher direct labor and lower interest expenses.
The current Zacks Consensus Estimate for the ongoing quarter and
fiscal 2014 are pegged at $1.43 and $5.33, respectively,
representing a year-over-year decline of 8.3% and 16.2%. These
reflect a negative investor perception about the growth prospects
of the company. Consequently, CACI is susceptible to a further
downgrade in the imminent future.
Although, our proven model does not conclusively show that CACI is
likely to miss earnings this quarter, the expectations are highly
skewed in favor of a strong miss.
Zero Zacks ESP: Expected Surprise Prediction or
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is currently pegged at
0.00%. This indicates a likely in line earnings for the shares.
Zacks Rank #5 (Strong Sell): CACI's Zacks Rank #5 tilts the
predictive power of ESP in the negative direction. Note that stocks
with Zacks Ranks of #1, #2 and #3 have a significantly higher
chance of beating earnings. The Sell-rated stocks (#4 and #5)
should never be considered going into an earnings announcement.
Other Stocks to Consider
Here are some companies you may want to consider as our model shows
that these have the right combination of elements to post an
earnings beat this quarter:
Abercrombie & Fitch Co. (
), earnings ESP of +20.00% and Zacks Rank #2 (Buy).
MidWest One Financial Group, Inc. (
), earnings ESP of +1.82% and Zacks Rank #2 (Buy).
Perry Ellis International Inc. (
), earnings ESP of +7.69% and Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
ABERCROMBIE (ANF): Free Stock Analysis Report
PERRY ELLIS INT (PERY): Free Stock Analysis
CACI INTL A (CACI): Free Stock Analysis Report
MIDWESTONE FINL (MOFG): Free Stock Analysis
To read this article on Zacks.com click here.