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2 Electronic Stocks Lined Up for Earnings Reports: AME, GRMN

Technology sector earnings will be in full swing this week. The last week ended on a disappointing note for the sector with both tech behemoths Alphabet Inc. GOOGL and Microsoft Corp MSFT missing estimates, in stark contrast to the general trend witnessed this earnings season, wherein low expectations have provided an easy-to-beat hurdle for most companies.

The sector so far has had a mediocre run with total earnings of the companies, representing 49.6% of the sector’s total market capitalization in the S&P 500 index, down 6% on 1% lower revenues. Further, per the latest Zacks Earnings Trend report, earnings for the overall Technology sector will decline 5.8% year over year in the first quarter.

As reporting peaks this week, we will see first quarter results from more than 60% index members. Of these, let’s see what’s in the cards for a couple of stocks from the electronics space, namely Ametek Inc. AME and Garmin Ltd. GRMN.

Ametek, a leading manufacturer of electronic instruments and electromechanical devices worldwide, is slated to report first quarter 2016 results on Apr 28. For the quarter, Ametek has an Earnings ESP of +1.75% and it carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for the quarter is pegged at 57 cents.

We note the company’s earnings matched the Zacks Consensus Estimate in the preceding four quarters.

The company’s strong execution of four core growth strategies of operational excellence, global market expansion, investments in product development and strategic acquisitions are likely to drive growth.

This, in combination with a strong portfolio of businesses, will help the company to post better results in the to-be reported quarter. (Read more: Will Ametek Earnings Surpass Estimates in Q1?)

Garmin, a leading provider of navigation, communication and information devices, is set to report first quarter 2016 results on Apr 27. Garmin has an Earnings ESP of 0.00% and it carries a Zacks Rank #3. The Zacks Consensus Estimate for the quarter is pegged at 43 cents.

Last quarter, the company posted a positive earnings surprise of 57.45%. The company has missed the Zacks Consensus Estimate twice, matched once and exceeded once in the preceding four quarters, resulting in an average surprise of 12.59%.

The company’s expanding product line in each segment and strong underlying business trends are the positives. Its continued investments in R&D and advertising are expected to result in new revenue opportunities and long-term growth.

However, the macroeconomic challenges faced in 2015 remain part of the current operating environment. (Read more: Can Garmin Pull Off a Surprise in Q1 Earnings?)

Stay tuned! We will be following up with earnings reports on these stocks.

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MICROSOFT CORP (MSFT): Free Stock Analysis Report
 
GARMIN LTD (GRMN): Free Stock Analysis Report
 
AMETEK INC (AME): Free Stock Analysis Report
 
ALPHABET INC-A (GOOGL): Free Stock Analysis Report
 
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