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The Zacks Analyst Blog Highlights: Danaher Corp, PulteGroup, Penske Automotive, Mattel and Altra Industrial Motion Corp

Zacks Equity Research
·7 min read

For Immediate Release

Chicago, IL – October 22, 2020 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Danaher Corporation DHR, PulteGroup, Inc. PHM, Penske Automotive Group, Inc. PAG, Mattel, Inc. MAT and Altra Industrial Motion Corp. AIMC.

Here are highlights from Wednesday’s Analyst Blog:

5 High-Flying Stocks with Room to Run on Q3 Earnings This Week

The third-quarter 2020 earnings season is likely to have strong implications on Wall Street after disappointing results for the coronavirus-hit second quarter. Corporate profits in the third quarter and the guidance issued will be thoroughly scrutinized by financial experts and economists to gauge whether the U.S. economy will witness a V-shaped recovery this year from the coronavirus-led devastations.

Meanwhile, five companies with a favorable Zacks Rank are poised to beat earnings estimates this week. All these stocks have surged in the third quarter. An earnings beat is likely to result in further upward movement of their stock prices in the near future.  

Q3 at a Glance

The third quarter has two characteristics —  U.S. economic recovery, which witnessed a noticeable momentum in May and June, buoyed by the unprecedented fiscal and monetary stimulus by the U.S. government and the Fed, continued in July.

However, a series of economic data for August and September indicated that the economic momentum has lost its pace. The primary reason for this slow pace of growth is the termination of the $2.2-trillion fiscal stimulus — popularly known as the CARES Act — at the end of July.

Both Republicans and Democrats have agreed on a second round of fiscal stimulus. Coronavirus woes continue to hurt the economy. Resurgence of COVID-19 infections in several states has compelled the U.S. economy to operate at a significant sub-optimal level. Moreover, lack of vaccines or a proper line of treatment has only worsened the situation.

Nevertheless, disagreements appear related to the size and scope of the aid package. Notably, the Democrats initially demanded a $3.4-trillion package, which they later reduced to $2.2 trillion. Meanwhile, the Republicans initially offered a $1-trillion package, which was later increased to $1.8 trillion. No Congressional deal about a new fiscal stimulus has been reached to date.

Our Top Picks

We have narrowed down our search to five stocks slated to release third-quarter results this week. Each of these stocks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy) and has a positive Earnings ESP. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our research shows that for stocks with the combination of a Zacks Rank #3 (Hold) or better and a positive Earnings ESP,  the chance of an earnings beat is as high as 70%. These stocks are anticipated to appreciate after earnings releases. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Danaher Corp. designs, manufactures, and markets professional, medical, industrial, and commercial products and services worldwide. It operates through three segments — Life Sciences, Diagnostics, and Environmental & Applied Solutions. The company has an Earnings ESP of +2.56%.

The company has an expected earnings growth rate of 24% for the current year. The Zacks Consensus Estimate for the current year has improved 0.2% over the last 30 days. It has a trailing four-quarter earnings surprise of 10.8%, on average. The stock price of the Zacks Rank #2 company has climbed  21.8% in the third quarter. The company is set to release earnings on Oct 22, before the opening bell.

PulteGroup is engaged in the homebuilding and financial services businesses, primarily in the United States. The company has an Earnings ESP of +5.99%. The stock price of the Zacks Rank #1 company soared 36% in the third quarter.

The company has an expected earnings growth rate of 23.5% for the current year. The Zacks Consensus Estimate for the current year has improved 0.2% over the last 7 days. It has a trailing four-quarter earnings surprise of 14.5%, on average. The company is set to release earnings on Oct 22, before the opening bell.

Penske Automotive Group is a diversified transportation services company that operates automotive and commercial truck dealerships. It operates through four segments: Retail Automotive, Retail Commercial Truck, Other, and Non-Automotive Investments. The company has an Earnings ESP of +5.55%.

The Zacks Consensus Estimate for the current year has improved 2.1% over the last 7 days. It has a trailing four-quarter earnings surprise of 1.7%, on average. The stock price of the Zacks Rank #2 company has jumped 23.1% in the third quarter. It is set to release earnings on Oct 22, before the opening bell.

Mattel is a children's entertainment company, which designs and produces toys and consumer products worldwide. It operates through the North America, International, and American Girl segments. The Zacks Rank #2 company has an Earnings ESP of +6.38%.

The company has an expected earnings growth rate of 60% for the current year. The Zacks Consensus Estimate for the current year has improved 20% over the last 30 days. It has a trailing four-quarter earnings surprise of 74.4%, on average. The stock price has appreciated 21% in the third quarter. The company is set to release earnings on Oct 22, after the closing bell.

Altra Industrial Motion designs, produces and markets a range of electromechanical power transmission motion control products for use in various motion related applications, and high-volume manufacturing and non-manufacturing processes worldwide. It operates through two segments, Power Transmission Technologies and Automation & Specialty. The company has an Earnings ESP of +2.04%.

The Zacks Consensus Estimate for the current year has improved 3.2% over the last 7 days. It has a trailing four-quarter earnings surprise of 31.4%, on average. The stock price of the Zacks Rank #2 company advanced 16% in the third quarter. It is set to release earnings on Oct 23, before the opening bell.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>

Media Contact

Zacks Investment Research

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Mattel, Inc. (MAT) : Free Stock Analysis Report
 
Penske Automotive Group, Inc. (PAG) : Free Stock Analysis Report
 
PulteGroup, Inc. (PHM) : Free Stock Analysis Report
 
Danaher Corporation (DHR) : Free Stock Analysis Report
 
Altra Industrial Motion Corp. (AIMC) : Free Stock Analysis Report
 
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