TriMas Corporation TRS is slated to report second-quarter 2015 results before the opening bell on Aug 4. The company will also provide its updated business outlook following the spin-off of the Cequent businesses that was completed in June.
Last quarter, the company posted a negative surprise of 4.65%. TriMas has delivered an average negative surprise of 0.05% for the trailing four quarters. Let's see how things are shaping up for this announcement.
Factors to Consider
On Jun 30, TriMas completed the tax-free spin-off of its Cequent businesses. The process has been ongoing since Dec 2014 when the company approved the decision to spin off its truck and trailer accessories unit, Cequent, into a new stand-alone, publicly traded company. The move reflects TriMas’ commitment toward enhancing shareholder value through active management of business portfolio and organizational focus.
After the spin-off, TriMas now comprises the Packaging, Aerospace, Energy and Engineered Components segments. The move is expected to increase efficiency and help to generate value for shareholders, customers and employees.
TriMas believes that there will be further opportunities to reduce the cost structures through ongoing manufacturing, overhead and administrative productivity initiatives, global sourcing and selectively shifting manufacturing capabilities to countries with lower costs. However, headwinds arising from continued low oil prices and a stronger U.S. dollar, as well as lower-than-expected macroeconomic growth will continue to dent Trimas’ revenues.
Earnings Whispers
Our proven model does not conclusively show that TriMas will beat earnings this season. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below.
Zacks ESP: Earnings ESP, that represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is currently 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 32 cents.
Zacks Rank: TriMas has a Zacks Rank #5 (Strong Sell).
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Louisiana-Pacific Corp. LPX has an earnings ESP of +30.00% and a Zacks Rank #3. It will report second-quarter results on Aug 4.
Sterling Construction Co. Inc. STRL has an earnings ESP of +114.29% and a Zacks Rank #3. It will report second-quarter results on Aug 10.
Agrium Inc. AGU has an earnings ESP of +0.62% and a Zacks Rank #3. It will report second-quarter results on Aug 5.
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