Air Products (APD) to Post Q3 Earnings: What's in the Cards?
Air Products and Chemicals, Inc. APD is slated to release third-quarter fiscal 2023 results before the bell on Aug 3.
The industrial gas giant beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It pulled off a trailing four-quarter earnings surprise of around 1.3%, on average. The company delivered an earnings surprise of about 3.8% in the last reported quarter.
The benefits of investments in productivity improvements and high-return industrial gas projects are likely to be reflected in the APD’s results. Increased volumes and pricing are expected to have aided the company's performance despite adverse currency effects.
Shares of the company have increased 23.4% in the past year compared with a 10.5% rise of the industry.
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What do the Estimates Say?
The Zacks Consensus Estimate for sales for the to-be-reported quarter currently stands at $3,269 million, which suggests a rise of 2.5% from the year-ago reported number.
Our estimate for the Americas segment’s revenues is currently pegged at $1,299.6 million, indicating a fall of 8.2% year over year.
The same for the Asia segment’s revenues is pegged at $757 million, which suggests 0.7% year-over-year growth.
Our estimate for the Europe segment’s revenues stands at $798.8 million, indicating an 8% year-over-year increase.
Factors at Play
Air Products is likely to have benefited from improved price and volume in the fiscal third quarter.
Investments in high-return projects, new business transactions, acquisitions and productivity measures are also likely to have benefited APD. It is committed to its gasification approach and is carrying out its expansion plans. These initiatives are likely to have contributed to its earnings and cash flows. The benefits of the completion of the second phase of the Jazan project in Saudi Arabia are being realized by APD.
Air Products is also increasing productivity to reduce costs. It is experiencing the benefits of its productivity initiatives. Benefits from more productivity and cost-cutting initiatives are likely to have supported its margins in the quarter to be reported.
However, Air Products is exposed to headwinds from unfavorable currency translation. It is likely to have witnessed negative currency impacts on its sales and margins in the third quarter.
Air Products and Chemicals, Inc. Price and EPS Surprise
Air Products and Chemicals, Inc. price-eps-surprise | Air Products and Chemicals, Inc. Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Air Products this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Air Products is -0.60%. The Zacks Consensus Estimate for third-quarter earnings is currently pegged at $2.91. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter
Zacks Rank: Air Products currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
Livent Corporation LTHM, slated to release earnings on Aug 3, has an Earnings ESP of +2.43% and carries a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here. The consensus estimate for LTHM’s earnings for the second quarter is currently pegged at 46 cents.
Timken Steel Corporation TMST, scheduled to release earnings on Aug 3, has an Earnings ESP of +11.18%. The Zacks Consensus Estimate for TMST's earnings for the second quarter is currently pegged at 57 cents. TMST currently carries a Zacks Rank #1.
Albemarle Corporation ALB, scheduled to release earnings on Aug 2, has an Earnings ESP of +0.20%. The consensus estimate for Albemarle’s second-quarter earnings is currently pegged at $4.27. ALB currently carries a Zacks Rank #2.
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Air Products and Chemicals, Inc. (APD) : Free Stock Analysis Report
Albemarle Corporation (ALB) : Free Stock Analysis Report
Timken Steel Corporation (TMST) : Free Stock Analysis Report
Livent Corporation (LTHM) : Free Stock Analysis Report
