Snap-on Incorporated (NYSE:SNA) is likely to register year-over-year growth in its the top and bottom lines when it reports second-quarter 2022 results on Jul 21.
The Zacks Consensus Estimate for second-quarter earnings is currently pegged at $3.91 a share, suggesting growth of 4% from the year-ago quarter's reported figure. The consensus mark has been unchanged over the past 30 days. The consensus estimate for quarterly revenues is pegged at $1,101 million, indicating a rise of 1.8% from the year-ago quarter's actuals.
In the last reported quarter, the company posted an earnings beat of 8.7%. It delivered an earnings surprise of 11.2% in the trailing four quarters, on average.
Key Factors to Note
Snap-on has been gaining from its value-creation model, which focuses on enhancing the franchise network, improving relationships with repair shop owners and managers, and expanding critical industries in emerging markets. Management has also been leveraging capabilities in the automotive repair space and expanding the customer base, particularly in the automotive repair and critical industries.
The company has been on track with its Rapid Continuous Improvement process and other cost-reduction initiatives. The RCI process is designed to enhance organizational effectiveness, generate savings and minimize costs. Management has been making efforts to boost customer services along with enhancing manufacturing and supply chain capabilities through the RCI initiatives and further investments. All the aforesaid factors should have contributed to the company's top and bottom-line performances in the to-be-reported quarter.
However, Snap-on has been facing potential threats of new COVID-19 variants and supply-chain headwinds. Rising cost inflation, stemming from higher raw material expenses and increased transportation costs, is expected to have been concerning. Unfavorable foreign currency movement is also likely to have acted as a deterrent.
SnapOn Incorporated Price and EPS Surprise
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Snap-on 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. But that's not the case here. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Snap-on has a Zacks Rank #2 and an Earnings ESP of 0.00%.
Stocks With Favorable Combination
Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:
MGM Resorts International (NYSE:MGM) has an Earnings ESP of +60.20% and it currently sports a Zacks Rank of 1. The company is likely to register an increase in the bottom line when it reports second-quarter 2022 results. The Zacks Consensus Estimate for quarterly earnings moved 21% north to 29 cents per share, suggesting a surge of 323.1% from the year-ago quarter's reported number.
MGM Resorts International's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $3.05 billion, suggesting a rise of 34.3% from the figure reported in the prior-year quarter. MGM has delivered an earnings beat of 212.5%, on average, in the trailing four quarters.
Wyndham Hotels & Resorts (NYSE:WH) currently has an Earnings ESP of +1.55% and a Zacks Rank of 3. The company is likely to register an increase in the bottom line when it reports second-quarter 2022 results. The Zacks Consensus Estimate for quarterly earnings is pegged at 97 cents, which indicates a year-over-year improvement of 2.1%. The consensus mark has increased by a penny in the past 30 days.
The Zacks Consensus Estimate for Wyndham Hotels & Resorts' quarterly revenues is pegged at $359.2 million, suggesting a decline of 11.5% from the year-ago quarter's reported number. WH has delivered an earnings beat of 36.1%, on average, in the trailing four quarters.
BJ's Wholesale (NYSE:BJ) has an Earnings ESP of +3.61% and currently flaunts a Zacks Rank of 3. The company is likely to register a decrease in the bottom line when it reports second-quarter fiscal 2022 results. The Zacks Consensus Estimate for quarterly earnings has been unchanged at 80 cents per share in the past 30 days, indicating a decline of 2.4% from 82 cents a share registered in the year-ago quarter.
However, BJ's Wholesale's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $4.7 billion, which suggests growth of 12% from the figure reported in the prior-year quarter. BJ has delivered an earnings beat of 16.1% in the trailing four quarters, on average.
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