Actuant relies on its Industrial and Energy units for the bulk of profits. Global energy companies comprise much of its customer contingency, with industrial tools as its main product. Demand has picked up modestly across end markets and a more pronounced recovery might well be underway.
Given its recent history, it is unlikely Actuant Corporation (NYSE:ATU) will considerably exceed analyst estimates of $0.65 for the May quarter. However, interest will be placed upon the divestiture. The Electrical unit had been reporting slowing sales and limiting profitability. Divestitures are an activity that have been instrumental in allowing companies to divert resources to core operations, helping their fortunes over time. One example is NCR (see my December blog).
CLARCOR Inc. (NYSE:CLC) may surprise on filtration business momentum
CLARCOR Inc. (NYSE:CLC) produces engine and locomotive filtration systems, while also providing industrial and environmental filters. With those units poised for gains this year, more than mitigating a likely decline in packaging profits, CLARCOR Inc. (NYSE:CLC)’s earnings will probably gain ground this year.
Stricter regulations regarding engine emissions could be a catalyst to earnings, along with overall increased macroeconomic activity and automobile sales. Analysts estimate per share earnings of $0.67 for the May quarter and $2.56 for the full year, as compared with $0.65 and $2.42, respectively, in the year-ago period. I recommend taking a wait-and-see approach with the shares until consistent growth is underway.
Investors should be aware of these out-of-season earnings reports in mid-June if they hold industrial or shipping stocks. Depending on the results, portfolio adjustments ought to be considered.
The article 4 Earnings Reports to Watch Next Week originally appeared on Fool.com and is written by Damon Churchwell.
Damon Churchwell has no position in any stocks mentioned. The Motley Fool recommends FedEx. Damon is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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