International Flavors & Fragrances Inc.IFF is scheduled to report third-quarter 2015 results on Nov 9 after the market closes. The Zacks Consensus Estimate for the quarter is pegged at $1.35 per share.
The company has performed well in the last four quarters, with a positive average earnings surprise of 1.68%. Last quarter, the company's earnings came in at $1.36 per share, surpassing the Zacks Consensus Estimate of $1.35 by 0.74%. Let us see how things are shaping up for this quarter.
Factors to Affect Q3 Results
We believe International Flavors & Fragrances stands well positioned to benefit from the growing demand for flavors and fragrances, especially in emerging countries. The company's research and development wing constantly endeavors to develop innovative compounds so as to properly leverage the rising demand. In addition, acquisitions will help the company explore newer markets and a wider customer base.
Despite these long-term positives, International Flavors & Fragrances' international operations, however, face risks from adverse currency movements and geopolitical issues in some foreign countries. For 2015, the company expects adjusted earnings per share to grow 10%, while predicting a 6% increase in currency-neutral net sales. Adverse foreign currency movements are anticipated to reduce revenue growth by 7%.
Also, intense competition from existing or future rivals, coupled with aggressive price competition, might force International Flavors & Fragrances to reduce prices or increase spending; both of which will impact its sales and profits.
Earnings Whispers
Our proven model does not conclusively show that International Flavors & Fragrances is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. That is not the case here as you will see below.
Zacks ESP: International Flavors & Fragrances has an Earnings ESP of -1.48%, with the Most Accurate estimate of $1.33 lagging the Zacks Consensus Estimate of $1.35.
Zacks Rank: International Flavors & Fragrances currently carries a Zacks Rank #3.
Stocks to Consider
Here are some companies that you may want to consider instead as our model shows they have the right combination of elements to post an earnings beat this quarter:
Chemtura Corporation CHMT , with an Earnings ESP of +2.44% and a Zacks Rank #2.
Koppers Holdings Inc. KOP , with an Earnings ESP of +3.08% and a Zacks Rank #3.
Air Products & Chemicals Inc. APD , with an Earnings ESP of +0.59% and a Zacks Rank #3.
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INTL F & F (IFF): Free Stock Analysis Report
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CHEMTURA CORP (CHMT): 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.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
