S&P 500 (NYSE:SPY) component Praxair (NYSE:PX) will unveil its latest earnings on Wednesday, October 24, 2012. Praxair produces and sells atmospheric, process and specialty gases, and high-performance surface coatings to industrial clients.
Praxair Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average analyst estimate is for profit of $1.39 per share, a decline of 0.7% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from $1.49. Between one and three months ago, the average estimate moved down. It also has dropped from $1.40 during the last month. Analysts are projecting profit to rise by 3.9% versus last year to $5.64.
Past Earnings Performance: Last quarter, the company met expectations by reporting net income of $1.42 per share last quarter. In the previous first quarter, the company beat estimates by 2 cents.
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Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.97 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company regressed in this liquidity measure from 1.28 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 26.6% to $2.73 billion while assets decreased 4% to $2.65 billion.
Stock Price Performance: Between July 25, 2012 and October 18, 2012, the stock price rose $5.03 (4.9%), from $102.94 to $107.97. It saw one of its worst periods between May 7, 2012 and May 18, 2012 when shares fell for 10 straight days, dropping 8.4% (-$9.62) over that span. The stock price saw one of its best stretches over the last year between September 12, 2012 and September 20, 2012, when shares rose for seven straight days, increasing 2.4% (+$2.56) over that span.
Analyst Ratings: There are nine out of 16 analysts surveyed (56.3%) rating Praxair a buy. Over the past 90 days, the average rating for the stock has moved up from hold to moderate buy.
After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose more than threefold in the fourth quarter of the last fiscal year and 5.3% in the first quarter before increasing again in the second quarter.
On the top line, the company is looking to get back on the right track after last quarter’s drop snapped a string of revenue increases. Revenue rose 14.1% in the third quarter of the last fiscal year, 6.6% in the fourth quarter of the last fiscal year and 5.1%in the first quarter before dropping in the second quarter.
Wall St. Revenue Expectations: Analysts predict a decline of 1.7% in revenue from the year-earlier quarter to $2.85 billion.
A Look Back: In the second quarter, profit rose 0.9% to $429 million ($1.42 a share) from $425 million ($1.38 a share) the year earlier, meeting analyst expectations. Revenue fell 1.6% to $2.81 billion from $2.86 billion.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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