C.H. Robinson Worldwide Inc. CHRW is set to release fourth-quarter 2015 financial results after the market closes on Feb 2.
In the last quarter, the company posted a negative 3.23% earnings surprise. Let’s see how things are shaping up for this announcement.
Factors at Play
The Truckload business is highly challenged by the uncertainties plaguing its market. The current trend of road freight conversion to rail intermodal continue to put pressure on C.H. Robinson’s trucking business. Moreover, rising expenses are expected to impact margins further. We are also concerned about the company’s high debt level.
Earnings Whispers
Our proven model does not conclusively show that C.H. Robinson is likely to beat the Zacks Consensus Estimate this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or at least #3 (Hold) for this to happen. Unfortunately, this is not the case here as elaborated below.
Zacks ESP: The Earnings ESP for the company currently stands at -1.15% as the Most Accurate estimate is pegged at 86 cents while the Zacks Consensus Estimate is higher at 87 cents.
Zacks Rank: C.H. Robinson carries a Zacks Rank #4 (Sell).
Please note that Sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter.
Frontline Ltd. FRO with an Earnings ESP of +30.00% and a Zacks Rank #3.
InterDigital, Inc. IDCC has an earnings ESP of +33.33% and a Zacks Rank #3.
The Walt Disney Company DIS with an Earnings ESP of +1.38% and a Zacks Rank #3.
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