Yahoo Finance Chemical Stock Earnings Slated on May 1: ECL, OLN, ASH & CMP
A number of chemical companies are gearing up to report their quarterly numbers on May 1. Per the Zacks Industry classification, the chemical industry is grouped under the broader Basic Materials sector, which is among the Zacks sectors that are expected to score the strongest gains in Q1. Earnings for the sector are projected to surge 42.1% in Q1 while revenues are expected to move up 21%, per the latest Earnings Preview.
The chemical industry is riding high on an upswing in the global economy and continued demand strength across major end-use markets such as construction and automotive. Another positive for the industry is a recovery in demand in the energy space — a key chemical end-market that had been out of favor for a while. The recovery is being driven by a rebound in crude oil prices from their historic lows.
Notwithstanding a few challenges including raw material cost inflation, chemical companies are expected to continue the earnings momentum in the March quarter as the fundamental driving factors remain firmly in place.
Strategic measures including productivity improvement, pricing actions and portfolio restructuring are expected to continue to drive the performance of chemical makers in Q1. Cost-cutting measures by chemical companies should continue to yield industry-wide margin improvements. Synergies from acquisitions should also lend support to earnings. Moreover, President Donald Trump’s business-friendly tax reform is a positive for U.S. chemical stocks.
We take a look at four chemical companies that are gearing up to report their results tomorrow.
Ecolab Inc. ECL will report Q1 earnings numbers ahead of the bell. The company has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 88 cents. While the stock carries a favorable Zacks Rank #3 (Hold), its ESP makes surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Ecolab surpassed the Zacks Consensus Estimate in two of the trailing four quarters while missed twice, delivering an average negative surprise of around 0.1%.
For Q1, the Zacks Consensus Estimate for revenues is pegged at $3,367 million, reflecting a rise of 6.5% year over year.
The Zacks Consensus Estimate for revenues for the company’s Global Industrial segment are pegged at $1,193 million. The figure reflects an increase of 5.7% from the year-ago figure.
For the Global Energy segment, the Zacks Consensus Estimate for revenues stand at $812 million, reflecting a rise of 7.3% on a year-over-year basis.
The Zacks Consensus Estimate for the Global Institutional segment is presently pegged at $1,133 billion, reflecting a year-over-year rise of 5.1%.
Strong expected performance in the Global Industrial segment is likely to drive the company’s top line. Further, an expected improvement in revenues in the other segments is likely to help the company generate solid results in Q1. (Read more: Will Global Industrial Unit Boost Ecolab's Q1 Earnings?)
Ecolab Inc. Price and EPS Surprise
Ecolab Inc. price-eps-surprise | Ecolab Inc. Quote
Olin Corporation OLN will report Q1 results after the close. The company has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 18 cents. While the stock carries a Zacks Rank #3, its ESP makes surprise prediction difficult. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the last four quarters, the company delivered negative surprises thrice and posted in-line results once. The average earnings surprise was a negative 40.1%.
The Zacks Consensus Estimate for revenues for the to-be-reported quarter stands at $1,604 million, reflecting an expected increase of 2.4% from the year-ago quarter.
The company is expected to benefit from higher pricing of caustic soda, chlorine and chlorine-derivatives and reduced ethylene costs in Q1. However, it faces headwinds from raw material cost inflation (for benzene and propylene) and maintenance turnaround costs (across Chlor Alkali and Epoxy businesses).
Olin Corporation Price and EPS Surprise
Olin Corporation price-eps-surprise | Olin Corporation Quote
Ashland Global Holdings Inc. ASH will report fiscal Q2 results after the bell. The company has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at 84 cents. While the stock currently carries a Zacks Rank #3, its ESP makes surprise prediction difficult.
Ashland surpassed the Zacks Consensus Estimate in three of the trailing four quarters, delivering an average beat of 8.9%.
Revenues for fiscal Q2 are projected to decline 27.3% year over year, as the Zacks Consensus Estimate is currently $959.9 million.
Ashland is taking appropriate pricing actions in response to raw material cost inflation, which is expected to benefit it in Q2. However, this is likely to be partly offset in the quarter by the impact of the planned maintenance shutdown in the Marl, Germany, facility.
Ashland Global Holdings Inc. Price and EPS Surprise
Ashland Global Holdings Inc. price-eps-surprise | Ashland Global Holdings Inc. Quote
Compass Minerals International, Inc. CMP will report Q1 results after the bell. The company has an Earnings ESP of +67.65% as the Most Accurate estimate stands at 38 cents while the Zacks Consensus Estimate is pegged at 23 cents. However, it has a Zacks Rank #4 (Sell), which we caution against going into the earnings announcement.
Compass Minerals topped the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, resulting an average negative surprise of 32.7%.
The Zacks Consensus Estimate for revenues for the to-be-reported quarter stands at $417.9 million, reflecting an increase of 7.8% from the year-ago quarter.
The Zacks Consensus Estimate for sales of the company’s Salt segment is presently pegged at $304 million, reflecting an increase of 10.5% on a year-over-year basis. The same for the Plant Nutrition North America segment stands at $54 million, representing year-over-year growth of 10.2%.
Moreover, the Zacks Consensus Estimate for Plant Nutrition South America segment sales stands at $65 million, reflecting a rise of 6.6% from the year-ago quarter.
The company’s Salt unit is expected to benefit from increased winter weather activity. However, higher shipping and handling costs and high cost inventory are likely to affect the division’s margins.
Moreover, the company’s Plant Nutrition North America unit is likely to gain from higher demand for its sulfate of potash and innovative micronutrient products. However, higher logistics costs and depreciation expense may weigh on the segment’s margins. Meanwhile, continued strength in high-value specialty plant nutrients is expected to drive the Plant Nutrition South America segment.
Compass Minerals International, Inc. Price and EPS Surprise
Compass Minerals International, Inc. price-eps-surprise | Compass Minerals International, Inc. Quote
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