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MRC Global (MRC) to Report Q1 Earnings: What's in the Cards?

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·4-min read
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MRC Global Inc. MRC is scheduled to release first-quarter 2022 results on May 9, after market close.

The company reported better-than-expected results in each of the trailing four quarters. Earnings surprise was 146.39%, on average. In the last reported quarter, the company’s earnings of 17 cents topped the Zacks Consensus Estimate of a loss of 6 cents.

Zacks Investment Research
Zacks Investment Research


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In the past three months, shares of MRC Global have surged 61.4% compared with the industry’s increase of 17.9%.

Key Factors at Play

MRC Global is anticipated to have benefited from strength across its business in the gas utility sector, supported by several large contracts with gas utilities in the United States. Higher gas distribution system integrity management and new home construction activities are likely to have supplemented the revenues of the company’s business in the gas utility sector in the first quarter.

The company’s businesses in the upstream, midstream, downstream and industrial sectors are expected to have gained from contracts with several large refiners in the United States. MRC Global’s new energy transition-related projects (green energy and decarbonization), along with its focus on expanding its market share and improving working capital efficiency, are expected to have strengthened its performance in the to-be-reported quarter. Also, its focus on operational execution is expected to have helped it maintain a solid margin performance in the quarter.

Despite strength across its businesses, escalating cost of sales and operating expenses have been a concern for MRC Global. In fourth-quarter 2021, its cost of sales increased 18.4% year over year, while selling and administrative expenses jumped 9.3%. High raw material costs, along with supply-chain challenges and logistic issues, are expected to have adversely impacted its margin and profitability in the to-be-reported quarter.

Given its extensive regional presence, MRC Global’s operations are subject to global economic and political risks and forex woes. A stronger U.S. dollar might have hurt the company's overseas business in the to-be-reported quarter.

The Zacks Consensus Estimate for the U.S. segment’s revenues for the first quarter is currently pegged at $581 million, indicating a 2.7% increase from the quarter-ago reported number. The consensus estimate for revenues from the International segment is pegged at $90 million, indicating a sequential increase of 12.5%, while the same for the Canada segment stands at $38.4 million, suggesting a decline of 4% sequentially.

The Zacks Consensus Estimate for the company’s first-quarter total revenues is currently pegged at $721 million, suggesting 5.1% growth from the quarter-ago reported number. The consensus estimate for earnings of 17 cents suggests no change on a sequential basis.

Earnings Whispers

According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or at least 3 (Hold) to increase the odds of an earnings beat. But that is not the case here, as we will see below.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: MRC Global has an Earnings ESP of 0.00% as both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 17 cents.

MRC Global Inc. Price and EPS Surprise

MRC Global Inc. Price and EPS Surprise
MRC Global Inc. Price and EPS Surprise

MRC Global Inc. price-eps-surprise | MRC Global Inc. Quote

Zacks Rank: The company sports a Zacks Rank #1.

Key Picks

Here are some companies you may want to consider from the Zacks Industrial Products sector, as our model shows that these have the right combination of elements to post an earnings beat:

Lincoln Electric Holdings, Inc. LECO has an Earnings ESP of +0.63% and a Zacks Rank of 1, currently. Its earnings surprise in the last four quarters was 12.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, LECO’s earnings estimates have increased 8.7% for 2022. The stock has rallied 7.2% in the past three months.

Alta Equipment Group Inc. ALTG has an Earnings ESP of +84.62% and a Zacks Rank of 3, currently.

Earnings estimates of ALTG have decreased 5.7% for 2022 in the past 60 days. Its shares have declined 7.6% in the past three months.

The Middleby Corporation MIDD has an Earnings ESP of +2.55% and a Zacks Rank of 3 at present. Its earnings surprise in the last four quarters was 1.5%, on average.

Earnings estimates of MIDD have increased 0.1% for 2022 in the past 60 days. Its shares have lost 16% in the past three months.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Lincoln Electric Holdings, Inc. (LECO) : Free Stock Analysis Report

The Middleby Corporation (MIDD) : Free Stock Analysis Report

MRC Global Inc. (MRC) : Free Stock Analysis Report

Alta Equipment Group Inc. (ALTG) : Free Stock Analysis Report

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