Apogee (APOG) to Report Q2 Earnings: What's in the Cards?

Apogee Enterprises, Inc. APOG is slated to release second-quarter fiscal 2020 results on Sep 17, before the opening bell.

The Zacks Consensus Estimates for Apogee’s earnings per share is pegged at 57 cents for the fiscal second quarter — suggesting a fall of 24% from the year-ago quarter. The Zacks Consensus Estimate for revenues is pinned at $359 million, likely to drop from the year-ago quarter’s $362 million.

Let’s see how things are shaping up for this announcement.

Factors at Play

Apogee will likely benefit from solid bidding and order activities, a robust and increasing backlog, and an encouraging outlook for the North American commercial construction market in the to-be-reported quarter. Notably, this market is poised to grow throughout fiscal 2020, as its activities continue to reflect stellar growth across all regions and sectors in the United States, particularly, the office and institutional building segments, both of which are core markets for Apogee.

The company is also poised to benefit from its focus on strategy to grow and diversify the business, which will strengthen the company’s operations and boost profitability. The company’s continued focus on investment in projects will fuel growth and improve productivity.

Regarding acquisitions, Apogee is primarily focusing on the integration of EFCO to identify margin opportunities. The company is marching ahead with synergy goals by leveraging supplier relationships and driving on-time delivery. The company remains optimistic about this business’ long-term prospects.

Nevertheless, the company’s margins might be negatively impacted by start-up costs related to the strategic growth investment in Architectural Glass, as well as elevated corporate costs from higher legal expenses. Also, margins in the Architectural Services segment will likely be affected by lower volumes and lesser-favorable project maturity compared with fiscal 2019 levels in the soon-to-be-reported quarter.

Apogee Enterprises, Inc. Price and EPS Surprise

Apogee Enterprises, Inc. Price and EPS Surprise

Apogee Enterprises, Inc. price-eps-surprise | Apogee Enterprises, Inc. Quote

Earnings Whispers

Our proven model does not conclusively show that Apogee is likely to beat on earnings this quarter as it does not possess the key components. A stock needs to have both a positive Earnings ESP, and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold), for this to happen. This is not the case here as you will see below:

Earnings ESP: The Earnings ESP for Apogee is 0.00%. This is because the Most Accurate Estimate and the Zacks Consensus Estimate are both pegged at 57 cents, currently. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Apogee currently carries a Zacks Rank of 3.

It should be noted that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.

Share Price Performance

Apogee’s shares have lost around 15.5% over the past year compared with the industry’s decline of 31.5%.

Stocks Worth a Look

Here are some stocks worth considering as these have the right combination of elements to post an earnings beat this quarter.

Century Aluminum Company CENX has an Earnings ESP of +30.4% and carries a Zacks Rank #2, currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

Sonoco Products Company SON has an Earnings ESP of +2.01% and currently carries a Zacks Rank of 3.

Colfax Corporation CFX has an Earnings ESP of +1.42% and carries a Zacks Rank of 3, at present.

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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.

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