Nexa Resources (NEXA) to Report Q2 Earnings: What's in Store?
Nexa Resources S.A. NEXA is scheduled to report second-quarter 2022 results after the closing bell on Jul 28.
Q2 Estimates
The Zacks Consensus Estimate for second-quarter total sales is pegged at $807.5 million, suggesting an improvement of 17.7% from the prior-year quarter. The consensus mark for earnings currently stands at 58 cents, indicating a year-over-year decline of 29%. The earnings estimates have gone down 11% over the past 30 days.
Q1 Performance
In the last reported quarter, Nexa Resources’ earnings and revenues improved year over year, driven by higher metal prices. While earnings beat the Zacks Consensus Estimate, revenues missed the same. The company has a trailing four-quarter earnings surprise of 2.76%, on average.
Nexa Resources S.A. Price and EPS Surprise
Nexa Resources S.A. price-eps-surprise | Nexa Resources S.A. Quote
Factors to Note
The company reported a 14% increase in zinc production in the first quarter of 2022 due to lower grades and the temporary capacity reduction at Vazante. The Vazante underground mine was partially flooded due to heavy rainfall levels in the state of Minas Gerais, and daily production was reduced from mid-January until the end of March. The mine resumed full production in early April, and this will get reflected in the company’s second-quarter results. Overall, zinc production levels are expected to be higher in the second quarter of 2022 compared with the first quarter. Sales are expected to be higher as well, backed by continued solid demand for its products.
Meanwhile, operating costs related to workforce, energy, material and supplies due to inflationary cost pressure are likely to have impacted margins in the quarter to be reported. Nevertheless, improved operating performance and its cost-saving efforts may have negated these headwinds somewhat in the to-be-reported quarter’s results.
Over the course of the second quarter, a series of factors, including concerns about the global economy, weak demand in China and higher U.S interest rates, led to a downward trend in zinc and copper prices. The LME average prices for copper were down 20% — the largest quarterly loss since 2011. Zinc prices were down 24%, while lead prices slumped 21% in the quarter to be reported. Lower metal prices might have weighed on the second quarter's results.
What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Nexa Resources 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. But that’s not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The Earnings ESP for Nexa Resources is -30.44%.
Zacks Rank: Nexa Resources currently carries a Zacks Rank #5 (Strong Sell).
Price Performance
Shares of Nexa Resources have fallen 36.3% over the past year, compared with the industry's decline of 29.6%.
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Stocks Poised to Beat Estimates
Here are some Basic Materials stocks which you may consider, as our model shows that these have the right combination of elements to post an earnings beat in their upcoming releases.
Ingevity NGVT, slated to release earnings on Aug 2, has an Earnings ESP of +7.30% and a Zacks Rank #1.
The Zacks Consensus Estimate for NGVT’s second-quarter earnings has moved up 2% over the past 30 days. The consensus estimate for Ingevity’s earnings for the second quarter is pegged at $1.68.
Albemarle Corporation ALB, scheduled to release earnings on Aug 3, has an Earnings ESP of +11.87% and a Zacks Rank #2.
The Zacks Consensus Estimate for Albemarle's second-quarter earnings has been revised 5% upward over the past 30 days. The consensus estimate for ALB’s earnings for the quarter is currently pegged at $2.93.
Celanese Corporation CE, scheduled to release earnings on Jul 28, has an Earnings ESP of +0.89% and a Zacks Rank #3.
The Zacks Consensus Estimate for Celanese’s second-quarter earnings has been revised 2% upward over the past 30 days. The Zacks Consensus Estimate for CE’s earnings for the quarter to be reported is currently pegged at $4.58.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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