What's in the Offing for Stanley Black (SWK) in Q4 Earnings?
Stanley Black & Decker, Inc. SWK is scheduled to release fourth-quarter 2023 results on Feb 1, before market open.
The Zacks Consensus Estimate for Stanley Black’s fourth-quarter earnings has increased a penny in the past 60 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average beat being 52.4%.
The Zacks Consensus Estimate for this New Britain, CT-based tool maker’s fourth-quarter 2023 revenues is pegged at $3,856 million. The consensus estimate for the company’s adjusted earnings is pinned at 73 cents. SWK reported a loss of 10 cents in the year ago quarter.
Let’s see how things are shaping up for Stanley Black in this earnings season.
Factors to Note
SWK’s Industrial segment’s fourth-quarter 2023 performance is expected to have gained from the solid performance of the Engineered Fastening business, driven by strength in the aerospace and auto end markets. However, weakness in the Attachment Tool business due to customer destocking may have affected the segment’s revenues in the to-be-reported quarter. We expect revenues from SWK’s segment to decrease by 2.5% year-over-year to $588.8 million in the fourth quarter.
SWK’s cost-reduction program is likely to have aided its bottom line in the fourth quarter. The company is expected to put up a healthy margin performance in the upcoming quarterly results supported by supply-chain transformation and inventory reduction efforts. We anticipate SWK’s adjusted gross margin to be 28.7% compared with the adjusted gross margin of 19.5% reported in the year-ago quarter.
However, decreasing consumer outdoor and do-it-yourself market demand is expected to have affected the Tools & Outdoor segment’s results in the fourth quarter. We anticipate the segment’s revenues to dip 3.5% on a year-over-year basis to $3,264.5 million in the fourth quarter.
The company’s international presence keeps it exposed to the risk of adverse currency fluctuations, which might have hurt its performance in the to-be-reported quarter.
Stanley Black & Decker, Inc. Price and Consensus
Stanley Black & Decker, Inc. price-consensus-chart | Stanley Black & Decker, Inc. Quote
Earnings Whispers
Our proven model predicts an earnings beat for Stanley Black 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, which is the case here, as elaborated below.
Earnings ESP: Stanley Black has an Earnings ESP of +10.35% as the Most Accurate Estimate is pegged at 80 cents, which is higher than the Zacks Consensus Estimate of 73 cents per share. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.
Zacks Rank: Stanley Black presently carries a Zacks Rank of 3.
Highlights of Q3 Earnings
Stanley Black reported third-quarter 2023 adjusted earnings (excluding $1.02 from non-recurring items) of $1.05 per share, which beat the Zacks Consensus Estimate of 84 cents. The bottom line jumped 38.2% year over year due to lower costs. Stanley Black’s net sales of $3,953.9 million missed the Zacks Consensus Estimate of $4,019.3 million. The top line also declined 4% year over year due to weakness in the Tools & Outdoor segment.
Other Stocks to Consider
Here are some other companies within the broader Industrial Products sector that, according to our model, also have the right combination of elements to beat on earnings this reporting cycle.
Alarm.com Holdings, Inc. ALRM has an Earnings ESP of + 8.79% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is scheduled to release fourth-quarter 2023 results on Feb 22. Alarm.com’s earnings have surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 35%.
Ingersoll Rand Inc. IR has an Earnings ESP of +0.98% and a Zacks Rank of 3 at present. The company is slated to release fourth-quarter 2023 results on Feb 15.
Ingersoll Rand’s earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 16.1%.
RBC Bearings Incorporated RBC has an Earnings ESP of +8.19% and a Zacks Rank of 3 at present. The company is slated to release third-quarter fiscal 2024 (ended December 2023) results on Feb 8.
RBC Bearings’ earnings have surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 7.7%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Stanley Black & Decker, Inc. (SWK) : Free Stock Analysis Report
RBC Bearings Incorporated (RBC) : Free Stock Analysis Report
Ingersoll Rand Inc. (IR) : Free Stock Analysis Report
Alarm.com Holdings, Inc. (ALRM) : Free Stock Analysis Report
