The start of another big earnings week is here, with heavyweights like Facebook Inc (NASDAQ:FB) scheduled to announce their quarterly results later this week. In this article we’ll run through five companies’ earnings reports which were issued before the morning bell and see how those companies fared in their latest quarter and how the market is receiving their performance this morning.
Those companies are Kimberly Clark Corp (NYSE:KMB), Westinghouse Air Brake Technologies Corp (NYSE:WAB), Sprint Corp (NYSE:S), Rockwell Collins, Inc. (NYSE:COL), and Roper Technologies Inc (NYSE:ROP). We’ll also use hedge fund sentiment to see what traders think of these companies’ long-term potential.
At Insider Monkey, we track around 765 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details).
Double Beat Not Enough for Kimberly Clark
Consumer Products Giant Kimberly Clark Corp (NYSE:KMB) is down by 1.52% this morning despite its top- and bottom-line second quarter results beating analysts’ expectations. Sales of $4.59 billion topped the $4.57 billion consensus estimate, while adjusted earnings per share came in at $1.53, ahead of the consensus mark by $0.05. Sales came in slightly lower year-over-year, being heavily impacted by currency headwinds, while EPS showed a huge improvement from a loss of $0.83 a year earlier. The company’s consumer tissue segment, headlined by its Kleenex and Scott brands, did $1.49 billion in sales during the quarter, while its personal care unit headlined by Huggies managed $2.28 billion in sales. Each unit’s sales were down slightly year-over-year due to currency exchange, while volumes rose.
A dividend aristocrat, Kimberly Clark Corp (NYSE:KMB) was in the portfolios of 31 of the hedge funds tracked by Insider Monkey as of March 31. Those investors held $1.22 billion worth of the company’s shares, amounting to 2.50% of its float.
Sluggish Freight Group Derails Wabtec
Shares of Westinghouse Air Brake Technologies Corp (NYSE:WAB) have tumbled by 5.61% this morning following its second quarter earnings release. Sales fell by 15% year-over-year to $723.60 million, with the company’s Freight Group being hit particularly hard, with sales falling by 26% to $397.10 million. The Transit Group fared better, with sales rising by 5% to $326.50 million. Currency exchange was again a factor, impacting the company’s top-line by $9 million. Wabtec’s bottom-line resisted the top-line declines by remaining flat year-over-year at $1.05 per share, thanks partially to a 7% reduction in the float. With Freight expected to remain sluggish for the remainder of the year, Wabtec was forced to cut its top- and bottom-line guidance.
Westinghouse Air Brake Technologies Corp (NYSE:WAB) is a top stock pick of Cryder Capital, which held 219,165 shares of the company on June 30.
We’ll check out the earnings reports of Sprint, Rockwell Collins, and Roper Technologies on the next page.