Food products company
Lennox International, Inc.
) is scheduled to release second-quarter 2014 results before the
opening bell on Jul 21. The company had delivered a positive
earnings surprise of 2.44% in the preceding quarter. Let's see how
things are shaping up prior to this announcement.
Factors to Consider
Lennox has been trying to capture a significant market share
based on its organic growth, continuous launch of innovative
products. The company's new construction business is expected to
rebound in the coming quarters, leading to a rise in revenues and
Also, Lennox has been trying to reduce its expenses over the
past quarter, which led to an 80 basis points reduction in selling,
general and administrative expenses, in the first quarter 2014. The
company has been making efforts to increase shareholders' value. In
accordance, the board of directors increased the quarterly dividend
by 25% to 30 cents per share.
Our proven model does not conclusively show that Lennox is
likely to beat earnings this quarter. That is because a stock needs
to have both a positive
and a Zacks Rank of #1, #2 or #3 for this to happen. That is not
the case here as we will see below.
Expected Surprise Prediction or ESP, 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.
Lennox's Zacks Rank #3 (Hold), when combined with a 0.00% ESP makes
surprise predictions difficult. We caution against stocks with
Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings
announcement, especially when the company is seeing a negative
estimate revision momentum.
Other Stocks to Consider
Here are some companies in the industry that investors may want
to consider as our model shows that they have the right combination
of elements to post an earnings beat this quarter:
), Earnings ESP of +1.28% and a Zacks Rank #2 (Buy).
Ply Gem Holdings, Inc
), Earnings ESP of +35.29% and a Zacks Rank #3.
United Rentals, Inc.
),Earnings ESP of +2.80% and a Zacks Rank #3.
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