FLEX Set to Report Q3 Earnings: Here's What You Should Know
Flex Ltd FLEX is slated to report third-quarter fiscal 2023 results on Jan 25.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $7.48 billion, which suggests growth of 13% from the year-ago quarter’s reported figure. The consensus mark for earnings is pegged at 60 cents per share, indicating a year-over-year increase of 20%.
The company’s earnings beat the Zacks Consensus Estimate in all the last four quarters. It has a trailing four-quarter earnings surprise of 18.5%, on average.
For third-quarter fiscal 2023, the company expects revenues to be between $7.3 billion and $7.7 billion. The company expects adjusted earnings of 57-63 cents per share. The adjusted operating income is projected to be between $345 million and $375 million.
Flex Ltd. Price and EPS Surprise
Flex Ltd. price-eps-surprise | Flex Ltd. Quote
Factors to Note
The company’s performance in the third quarter is likely to have benefited from continued momentum in the company’s Agility Solutions and Reliability Solutions segments, backed by a strong customer backlog.
The company’s automotive sector is likely to benefit owing to increasing demand for electric vehicles and next-generation mobility. Moreover, the company’s healthcare segment is expected to benefit from strong demand for elective procedures and a continued ramp-up in large medical device programs.
The industrial business is likely to gain momentum owing to ongoing secular trends. Additionally, organizations are switching to domestic production to take advantage of the tax credits and boost their resilience under the inflation Reduction Act. This is likely to boost the growth prospects of the company in the renewable energy sector.
The company’s Communications, Enterprise and Cloud business is likely to benefit from continued strength within the cloud and communications sector.
The company continues to invest in research and development to minimize waste and prioritize sustainability as part of the company’s circular economy solutions.
However, the company’s performance is affected by semiconductor shortages. The lack of panel availability continues to weigh on the Nextracker segment’s performance. Stiff competition and leveraged balance sheets are further concerns.
What Our Model Says
Our proven model does not predict an earnings beat for FLEX this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
FLEX has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With Favorable Combination
Here are some stocks you may consider, as our proven model shows that these have the right mix of elements to beat estimates this time around.
Halliburton Company HAL has an Earnings ESP of +0.30% and currently carries a Zacks Rank #2. HAL is set to announce quarterly figures on Jan 24. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Halliburton’s to-be-reported quarter’s earnings and revenues is pegged at 67 cents per share and $5.58 billion, respectively. Shares of HAL have increased 45.9% in the past year.
SAP SE SAP has an Earnings ESP of +3.09% and presently carries a Zacks Rank #2. SAP is slated to release quarterly numbers on Jan 26.
The Zacks Consensus Estimate for SAP’s to-be-reported quarter’s earnings and revenues is pegged at $1.38 per share and $8.23 billion, respectively. Shares of SAP have lost 14.8% in the past year.
American Airlines Group AAL has an Earnings ESP of +16.71% and currently has a Zacks Rank #2. AAL is scheduled to report earnings on Jan 26.
The Zacks Consensus Estimate for AAL’s to-be-reported quarter’s earnings and revenues is pegged at 75 cents per share and $12.84 billion, respectively. Shares of AAL have lost 0.1% in the past year.
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