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Peek in Industrial Stocks Q2 Earnings on Aug 2: CSTM & More

With the Q2 earnings season taking center stage, investors are waiting to see how the major companies perform.

While estimating the performances of metal fabrication stocks, we note that headwinds like economic sluggishness of major industrial goods' consumers like China, forex issues and dismal pricing conditions in energy & mining markets might limit growth.

According to the Zacks Industry classification, the metal fabrication stocks are broadly grouped under Industrial Products, one of the 16 Zacks sectors. Per our latest Earnings Preview article, this industry is likely to underperform this earnings season.

In fact, our report dated Jul 29, 2016 indicates that overall earnings for the sector are expected to decrease 5.1% year over year in Q2, while revenues are expected to fall 5.8%. Notably, the sector had witnessed a decline of 22.2% and 8% in earnings and revenues, respectively, in Q1.

Recently, three machinery bigwigs - Barnes Group Inc.B , Gorman-Rupp Co.GRC and Graham CorporationGHM - reported Q2 results. Barnes Group's quarterly diluted earnings per share surpassed the Zacks Consensus Estimate and year-ago tally by 6.8% and 1.6%, respectively. Also, Gorman-Rupp's quarterly diluted earnings per share of 25 cents beat the Zacks Consensus Estimate by 13.6%. We also note that Graham Corporation's diluted earnings of 5 cents per share in Q2 exceeded the Zacks Consensus Estimate of 3 cents but decreased substantially from the year-ago tally of 23 cents.

With more and more companies slated to report their Q2 results soon, let's take a look at how these three metal fabrication stocks might fare.

What's in Store for these Metal Fabrication Stocks?

Constellium N.V.CSTM is set to release Q2 results, before the market opens on Aug 2. In the last four quarters, the company reported an average negative earnings surprise of 442.78%. Our proven model does not conclusively show that Constellium is likely to beat on earnings this quarter. This is because the company's Earnings ESP (the difference between the Most Accurate estimate and the Zacks Consensus Estimate) is 0.00%. The Zacks Consensus Estimate for the stock is currently pegged at 20 cents per share for Q2. The company carries a Zacks Rank #4 (Sell). We caution against Sell-rated stocks (Zacks Rank #4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

CONSTELLIUM NV Price and EPS Surprise

CONSTELLIUM NV Price and EPS Surprise | CONSTELLIUM NV Quote

MRC Global Inc.MRC is stated to report Q2 results, after the closing bell on Aug 2. In the last four quarters, the company reported an average positive earnings surprise of 148.48%. However, our proven model does not conclusively show that MRC Global is likely to surprise earnings this quarter. This is because the company's Earnings ESP is pegged at 0.00%, as both the Most Accurate Estimate and Zacks Consensus Estimate stand at a loss of 14 cents per share. The company carries a Zacks Rank #4 (Sell).

MRC GLOBAL INC Price and EPS Surprise

MRC GLOBAL INC Price and EPS Surprise | MRC GLOBAL INC Quote

Northwest Pipe Co.NWPX is set to report Q2 results, after the closing bell on Aug 2. In the last four quarters, the company reported an average negative earnings surprise of 89.33%. Our proven model does not conclusively show that Northwest Pipe is likely to beat on earnings this quarter. This is because the company's Earnings ESP is 0.00%, as both the Most Accurate Estimate and Zacks Consensus Estimate stand at a loss of 75 cents per share. The company carries a Zacks Rank #3 (Hold). Though stocks with a Zacks Ranks #1 (Strong Buy), 2 (Hold) or 3 have a significantly higher chance of beating earnings, an Earnings ESP of 0.00% makes surprise prediction difficult.

NORTHWEST PIPE Price and EPS Surprise

NORTHWEST PIPE Price and EPS Surprise | NORTHWEST PIPE Quote

Don't miss on our full earnings release articles for these three machinery stocks, as the actual results might hold some surprises!

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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

BARNES GRP (B): Free Stock Analysis Report

GRAHAM CORP (GHM): Free Stock Analysis Report

GORMAN RUPP CO (GRC): Free Stock Analysis Report

NORTHWEST PIPE (NWPX): Free Stock Analysis Report

CONSTELLIUM NV (CSTM): Free Stock Analysis Report

MRC GLOBAL INC (MRC): 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.

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