Will Rio Tinto Miss?

RELATED QUOTES

SymbolPriceChange
CLF18.76+0.47
RIO55.09+0.42
PSX82.57+0.27
SVLC1.710.00

 

Rio Tinto Plc. (RIO) is set to report full year 2012 results on Feb 14. It reported dismal half year results earlier, with a year-over-year decrease in both revenue and earnings. Let’s see how things are shaping up for this announcement.

Growth Factors for the First Half 2012

Rio Tinto was badly affected by lower prices of most of the commodities in the first half 2012 along with a decline in demand among regions like China, Europe and the US. However, prices for gold, minerals and thermal coal saw a rise in the reported period. The company increased its iron ore production at the Pilbara ports and Rio Tinto Coal Australia. There was, however, a blow to Rio’s margins in the period due to an increase in the energy, fuel and diesel costs.  

Earnings Whispers?

Our proven model does not conclusively show that Rio is likely to beat earnings this year. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank of #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Positive Zacks ESP: That is because the Most Accurate estimate stands at $4.93 while the Zacks Consensus Estimate is higher at $5.47. That is a difference of -9.9%.

Zacks Rank #3 (Hold): Rio’s Zacks Rank #3 (Hold) lowers the predictive power of ESP because the Zacks #3 Rank when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with Zacks #4 and #5 Ranks (Sell rated stocks) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:  

Cliffs Natural Resources Inc. (CLF), Earnings ESP of 10.9% and Zacks Rank #2 (Buy).

Silvercrest Mines Inc. (SVLC), Earnings ESP of 22.2% and Zacks Rank #2 (Buy).

Phillips 66 (PSX), Earnings ESP of 2.7% and Zacks Rank #2 (Buy).

Read the Full Research Report on CLF

Read the Full Research Report on RIO

Read the Full Research Report on PSX

Read the Full Research Report on SVLC

Zacks Investment Research



More From Zacks.com
Loading...
 
Recent Quotes
Symbol Price Change % Chg 
Your most recently viewed tickers will automatically show up here if you type a ticker in the "Enter symbol/company" at the bottom of this module.
You need to enable your browser cookies to view your most recent quotes.
 
Sign-in to view quotes in your portfolios.

Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.2581+0.0027+0.21%
    USDSGD=X
    1.7401+0.0054+0.31%
    EURSGD=X
    2.1139+0.0073+0.35%
    GBPSGD=X
    81.3044-0.3695-0.45%
    SGDJPY=X
    6.1625-0.0131-0.21%
    SGDHKD=X
    2.5984-0.0028-0.11%
    SGDMYR=X
    9,256.0459-43.6387-0.47%
    SGDIDR=X
    4.9669-0.0018-0.04%
    SGDCNY=X
    1.1653-0.0006-0.05%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,293.70+9.10+0.71%
    GCM14.CMX
    19.64+0.20+1.04%
    SIK14.CMX
    91.62-1.25-1.35%
    ^XAU
    3.12+0.06+1.96%
    HGK14.CMX
    101.88+0.44+0.43%
    CLM14.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.74+0.03
    ^FVX
    2.690.00
    ^TNX
    3.460.00
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.123+0.001+0.82%
    B22.SI
    0.15+0.008+5.63%
    545.SI
    0.635+0.040+6.72%
    5WH.SI
    0.615+0.005+0.82%
    E5H.SI
    1.355+0.005+0.37%
    G13.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    20.00+4.200+26.58%
    K6S.SI
    1.215+0.190+18.54%
    S53.SI
    0.415+0.045+12.16%
    570.SI
    1.345+0.130+10.70%
    5DA.SI
    0.154+0.014+10.00%
    5GD.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.053-0.059-52.68%
    5TF.SI
    1.62-0.520-24.30%
    N02.SI
    0.20-0.020-9.09%
    E94.SI
    0.179-0.013-6.77%
    567.SI
    0.30-0.020-6.25%
    508.SI