Will Q3 Earnings Hold A Surprise For Grainger (GWW) Stock?
Zacks Investment Research | Oct 13, 2016 09:27PM ET
The leading broad line supplier of maintenance, repair and operating (MRO) products, W.W. Grainger, Inc. (NYSE:GWW) , is scheduled to report third-quarter 2016 results on Oct 18, before the opening bell.
Last quarter, the company posted a year-over-year decline in earnings. Let’s see how things are shaping up for this announcement.
Earnings Whispers
Our proven model does not conclusively show that the company is likely to beat earnings 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 3 (Hold) for this to happen. That is not the case here, as you will see below.
Zacks ESP: The Earnings ESP for Grainger is 0.00%. This is because the Most Accurate estimate of $3.02 is in line with the Zacks Consensus Estimate.
Zacks Rank: Grainger carries a Zacks Rank #3, which increases the predictive power of ESP However, the company’s ESP of 0.00% makes surprise prediction difficult.
We caution against stocks with a Zacks Rank #4 or 5 (Sell-rated stocks) going into an earnings announcement, especially when the company is seeing negative estimate revisions.
Surprise History
In the second quarter of 2016, Grainger posted a negative earnings surprise of 8.83%. However, it surpassed the Zacks Consensus Estimate in two of the last four quarters with an average positive earnings surprise of 3.14%.
GRAINGER W W Price and EPS Surprise
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