International Flavors & Fragrances Inc.IFF is scheduled to report fourth-quarter 2015 results on Feb 10 after the market close. The Zacks Consensus Estimate for the quarter is pegged at $1.15 per share.
The company's performance in the last four quarters was impressive, with a positive average earnings surprise of 2.42%. In the preceding quarter, the company's earnings of $1.39 per share surpassed the Zacks Consensus Estimate of $1.35 by 2.96%. Let us see how things are shaping up for this quarter.
Factors to Affect Q4 Results
We believe International Flavors & Fragrances' diversified product portfolio and a solid customer base will drive its growth, going forward. Also, to meet the growing demand for flavors and fragrances across the world, especially in the emerging nations, the company constantly innovates and develops improved products. Moreover, the company attempts to gain access to desirable customer bases, regions or technologies through meaningful acquisitions.
We believe International Flavors & Fragrances' organic and inorganic expansion strategies will help it improve profitability. This, combined with a solid cash position, will enable the company to reward its shareholders handsomely with dividend payments and share buybacks.
However, International Flavors & Fragrances is not immune to the negative impact of foreign currency movements, geopolitical issues in some foreign countries and stiff competition. For 2015, the company anticipates a negative foreign currency impact of 7% on revenue growth.
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 0.00%, with both the Most Accurate estimate and the Zacks Consensus Estimate standing at $1.15.
Zacks Rank: International Flavors & Fragrances currently carries a Zacks Rank #4 (Sell), which when combined with a 0.00% Earnings ESP, makes surprise predictions difficult.
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:
Albemarle Corporation ALB , with an Earnings ESP of +1.21% and a Zacks Rank #3.
Axiall Corporation AXLL , with an Earnings ESP of +21.21% and a Zacks Rank #3.
LyondellBasell Industries N.V. LYB , with an Earnings ESP of +0.43% and a Zacks Rank #3.