AptarGroup, Inc. ATR is scheduled to report fourth-quarter results before the market opens on Feb 21.
The company’s third-quarter adjusted earnings per share of 99 cents beat the Zacks Consensus Estimate of 93 cents. On a year-over-year basis, earnings improved 21%. Revenues rose 7% to $666 million from the year-ago quarter, surpassing the Zacks Consensus Estimate of $664 million.
Notably, AptarGroup’s bottom line surpassed the Zacks Consensus Estimate in the trailing four quarters, recording average positive surprise of 8.73%.
AptarGroup’s shares have gained 11% over the past year, against the industry’s decline of 5%.
Let’s see how things are shaping up prior to this announcement.
Key Factors to Consider
AptarGroup’s results in the last quarter of the year typically are negatively impacted by customer plant shutdowns in December. Furthermore, its performance will be impacted by seasonality of certain products and changes in product mix. Further, elevated raw material costs and transportation costs are expected to affect near-term margins. Nevertheless, AptarGroup is poised to gain from business-transformation plan, successful product roll outs and focus on improving operations.
AptarGroup, Inc. Price and EPS Surprise
AptarGroup, Inc. price-eps-surprise | AptarGroup, Inc. Quote
AptarGroup projects earnings per share for fourth-quarter 2018 of 81-86 cents. The guidance reflects year-over-year growth of 18% at the mid-point. For the December-end quarter, the company expects core sales to improve in each segment.
The Zacks Consensus Estimate for total sales of $664 million indicates an increase of 6% from the prior-year quarter. The estimate for AptarGroup’s fourth-quarter earnings per share is pegged at 84 cents, showing a year-over-year improvement of 3.7%.
The Zacks Consensus Estimate for Beauty & Home segment revenues is at $326 million, down around 3% year over year. The segment is expected to report profit of $24 million, flat from the prior-year comparable quarter.
The Zacks Consensus Estimate for the Food & Beverage segment is at $94 million for the fourth quarter, up 13% year over year from $83 million. The estimate for the segment’s operating profit is at $7 million, up from the $5.12 million reported on the fourth quarter of 2017.
The Zacks Consensus Estimate for the Pharma segment sales is pegged at $238 million for the fourth quarter, calling for an increase of 14% year over year. The segment is expected to report profit of $69 million, an increase of 13% from the prior year comparable quarter.
Our proven model does not conclusively show a beat for AptarGroup this earnings season 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 3 (Hold) for this to happen. This is not the case here as you will see below:
Earnings ESP: Earnings ESP for AptarGroup is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: AptarGroup currently carries a Zacks Rank #3. Though a Zacks Rank #3 increases the predictive power of ESP, the company's 0.00% ESP makes surprise prediction difficult.
Note 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.
Stocks to Consider
Here are a few companies that you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
Adamas Pharmaceuticals, Inc. ADMS has an Earnings ESP of +10.29% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Allison Transmission Holdings, Inc. ALSN has an Earnings ESP of +5.94% and a Zacks Rank #3.
AMC Entertainment Holdings, Inc. AMC has an Earnings ESP of +3.88% and a Zacks Rank #3.
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