What's in the Offing for Berry Global (BERY) in Q4 Earnings?
Berry Global Group BERY is scheduled to release fourth-quarter fiscal 2023 (ended Sep 30, 2023) results on Nov 16, before market open.
The Zacks Consensus Estimate for fiscal fourth-quarter earnings has been revised downward by 0.9% in the past 60 days. The company pulled off a trailing four-quarter earnings surprise of 1.7%, on average.
Let’s see how things have shaped up for BERY’s fiscal fourth quarter.
Berry Global Group, Inc. Price and EPS Surprise
Berry Global Group, Inc. price-eps-surprise | Berry Global Group, Inc. Quote
Factors to Note
Lower market demand as a result of inflationary pressure is expected to weigh on Berry Global’s fiscal fourth-quarter results.
Headwinds from general market softness and customer destocking are expected to get reflected in the company’s top-line results.
Softer consumer and industrial market demand in Europe and customer destocking has been affecting the Consumer Packaging International segment’s performance. We expect the segment’s revenues to decrease 1.9% year over year in the to-be-reported quarter.
The Consumer Packaging North America segment is expected to put up a weak show in the soon-to-be-reported quarter due to lower selling prices owing to the pass-through of lower resin costs in the United States and reduced demand in the industrial end markets. Our estimate for Consumer Packaging North America segment revenues indicates an 11.5% decline from the year-ago reported number.
The Engineered Materials segment is experiencing weakness due to lower selling prices from the pass-through of lower resin costs in the United States, volume softness in European industrial markets and customer destocking. We expect the segment’s revenues to decline 7.5% year over year in the fiscal fourth quarter.
Softness in filtration, building, and construction end markets, and lower selling prices on the pass-through of lower resin costs have been a drag on the Health, Hygiene, & Specialties segment’s performance. We expect the segment’s revenues to decline 9.6% year over year in the fiscal fourth quarter.
Berry Global’s global cost-reduction actions, including site rationalizations, moving business to more cost-efficient facilities and reducing labor costs, are expected to support the company’s bottom line.
BERY’s fiscal fourth-quarter performance is expected to reflect benefits from the June 2023 acquisition of Pro-Western Plastics. The buyout boosted BERY’s container business in North America, particularly in the dairy, industrial, and medical sectors.
What Does the Zacks Model Say?
Our proven model does not conclusively predict an earnings beat for Berry Global this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates, which is not the case here, as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Berry Global has an Earnings ESP of -0.47% as the Most Accurate Estimate is pegged at $2.12, lower than the Zacks Consensus Estimate of $2.13. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Berry Global currently carries a Zacks Rank #3.
Highlights of Q3 Earnings
Berry Global reported third-quarter fiscal 2023 adjusted earnings of $1.90 per share, which missed the Zacks Consensus Estimate of $1.97. The bottom line decreased 6.4% year over year, primarily due to weakness in the consumer and industrial end markets. Net sales of $3,229 million missed the Zacks Consensus Estimate of $3,461.6 million. The top line decreased 13.3% year over year due to a 7% dip in volumes and lower selling prices, which declined $250 million due to the pass-through of lower resin costs.
Performance of Some Industrial Companies
Here are some companies that recently reported earnings numbers.
The Middleby Corporation MIDD reported third-quarter 2023 adjusted earnings (excluding 34 cents from non-recurring items) of $2.35 per share, which surpassed the Zacks Consensus Estimate of $2.29. The bottom line increased 7.8% year over year due to lower costs.
Middleby’s net sales of $980.7 million missed the Zacks Consensus Estimate of $1020.6 million. The top line dipped 1.2% year over year. Organic revenues in the reported quarter decreased 1.4%. Acquired assets boosted sales by 1.8%, while movements in foreign currencies had a positive impact of 1.3%.
Parker-Hannifin Corporation PH reported first-quarter fiscal 2024 (ended Sep 30, 2023) adjusted earnings (excluding 97 cents from non-recurring items) of $5.96 per share, which beat the Zacks Consensus Estimate of $5.33. The bottom line jumped 26% year over year.
Parker-Hannifin’s total revenues of $4,847.5 million missed the Zacks Consensus Estimate of $4,890.3 million. The top line jumped 14.5% year over year. Contribution from the Meggitt acquisition and operational improvement drove the company’s top line. Organic sales for the quarter increased 2% year over year. Orders were up 2% year over year.
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