Will Lennox (LII) Beat Q2 Earnings Estimates? - Analyst Blog


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Food products company Lennox International, Inc. ( LII ) 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 earnings.

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.

Earnings Whispers

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 Earnings ESP and a Zacks Rank of #1, #2 or #3 for this to happen. That is not the case here as we will see below.

Earnings ESP:   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.

Zacks Rank: 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:

Curtiss-Wright Corporation ( CW ), Earnings ESP of +1.28% and a Zacks Rank #2 (Buy).

Ply Gem Holdings, Inc ( PGEM ), Earnings ESP of +35.29% and a Zacks Rank #3.

United Rentals, Inc. ( URI ),Earnings ESP of +2.80% and a Zacks Rank #3.

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LENNOX INTL INC (LII): Free Stock Analysis Report

CURTISS WRIGHT (CW): Free Stock Analysis Report

UTD RENTALS INC (URI): Free Stock Analysis Report

PLY GEM HOLDING (PGEM): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Earnings , Stocks
More Headlines for: LII , CW , URI , PGEM

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