TriMas Corporation (TRS) is set to report third-quarter 2014 results before the opening bell on Oct 28. Last quarter, this diversified global manufacturer of engineered and applied products posted an earnings surprise of 0.00%. Let’s see how things are shaping up prior to the announcement.
Factors to Consider
TriMas continues to face both external market pressure and operational challenges in its Energy and Aerospace businesses. Even though the company has initiated necessary actions to improve the performance of these segments, the pace has not been as per expectations.
TriMas’ Cequent businesses continue to face additional margin pressure during the back half of 2014. The positive trends, which are being observed in certain businesses, are expected to be more than offset by the recent headwinds.
In September, TriMas lowered its full-year 2014 earnings per share guidance to a range of $1.85 and $1.95 from $2.15 to $2.25. Compared with the year-ago earnings per share of $2.06, the new guidance depicts a year-over-year decline in the range of 5% to 10%. The company projects the year-over-year sales growth to be within 6% to 7%, as compared with 2013.
Earnings Whispers?
Our proven model does not conclusively show that TriMas is likely to beat earnings this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.
Negative Zacks ESP: The Expected Surprise Prediction or ESP for TriMas is -6.67% as the Most Accurate Estimate of 42 cents is below the Zacks Consensus Estimate of 45 cents per share.
Zacks Rank #4 (Sell): TriMas currently holds a Zacks Rank #4. We caution against stocks with Zacks Rank #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Other Stocks to Consider
Other stocks worth considering in the industrial products sector that have both a positive earnings ESP and a favorable Zacks Rank are:
Century Aluminum Co. (CENX) with an Earnings ESP of +11.76% has a Zacks Rank #1 (Strong Buy).
Noranda Aluminum Holding Corp. (NOR) has an Earnings ESP of +83.33% and a Zacks Rank #2 (Buy).
Alamo Group, Inc. (ALG) with an Earnings ESP of +4.44% holds a Zacks Rank #2.
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