Earnings Preview: Halliburton, Honeywell, Kimberly Clark, P&GVW Staff
On Friday, the following companies will wrap up the week with earnings reports: Halliburton Company (NYSE:HAL), Honeywell International Inc. (NYSE:HON), Kimberly Clark Corp (NYSE:KMB), The Procter & Gamble Company (NYSE:PG) and Weyerhaeuser Company (NYSE:WY).
All of them will come before the opening bell.
In the third quarter, the company reported a 2% sequential fall in revenues and an 18% decline in operating income, primarily from weak North American drilling and a pressure pumping market oversupply.
But this may not offset analysts estimates of a 39 percent earnings decline to 61 cents vs. the previous year’s $1. In the last four quarters, Halliburton Company (NYSE:HAL)’s earnings have topped estimates but in the last 90 days, it has fallen from 62 cents.
Quarterly revenues are expected to stay flat vs. 2011’s $7.06 billion. For 2012, revenue has been projected at $28.27 billion.
Investors should keep their eye on Halliburton Company (NYSE:HAL)’s strategy for international markets markets and the margins outlook for the next two years.
For the nine months ended 30 September 2012, Halliburton Company revenues increased 19% to $21.21B. Net income before extraordinary items decreased 5% to $1.99B. Revenues reflect Completion and Production segment increase of 21% to $13.04B, Drilling and Evaluation segment increase of 18% to $8.17B, North America segment increase of 19% to $12.25B, Middle East/Asia segment increase of 23% to $3.06B, Latin America segment increase of 24% to $2.61B.
On the stock, 71 percent of analysts have either a “Strong buy” or “Buy” rating while 29 percent have a “Hold” rating. It doesn’t have any “Sell” ratings.
Honeywell International (HON)
Analysts have projected earnings of $4.48 per share for the fiscal year with revenue estimated at $9.51 billion for the quarter, 0.4% higher than the previous year’s $9.47 billion total. For the year, revenue has been projected at $37.6 billion.
The earnings per share estimate is $1.09, up 3.8% from the previous year’s $1.05. Three months ago the target was $1.15.
For the nine months ended 30 September 2012, Honeywell International Inc. (NYSE:HON) revenues increased 3% to $28.08B. Net income before extraordinary items increased 22% to $2.68B. Revenues reflect Aerospace Systems segment increase of 4% to $3.04B, Automation and Control segment increase of less than 1% to $3.96B. Net income benefited from Other, net decrease from $35M (expense) to $1M (income).
Honeywell International Inc. (NYSE:HON) has been rated as a “Buy” by 81% of analysts but in the last three months, they have been more cautious about the stock.
Kimberly Clark (KMB)
Analysts have estimated Kimberly Clark Corp (NYSE:KMB) will report $1.36 earnings per share, up 6.3% from the previous year’s $1.28 earnings per share.
For the fiscal year, analysts have projected earnings at $5.23 per share while revenue has been estimated at $5.19 billion for the quarter, a 0.3% rise from the previous year’s $5.18 billion. For the year, revenue has been projected at $21 billion.
Kimberly Clark has reported an increasing profit for three straight quarters and in its most recent one, profit rose 19.7% year-over-year. In the second quarter, net income increased 22.1% and 33.7% for the first quarter.
For the nine months ended 30 September 2012, Kimberly Clark Corp (NYSE:KMB) revenues increased 1% to $15.76B. Net income increased 25% to $1.48B. Revenues reflect Personal Care segment increase of 4% to $7.2B, Health Care segment increase of 2% to $1.21B, Unallocated/Corporate and Other segment increase of 9% to $38M, Outside North America segment increase of 2% to $8.28B, North America segment remaining flat at $8.08B.
Most analysts have a “Hold” rating on the stock.
Look for The Procter & Gamble Company (NYSE:PG) Co.’s fiscal second-quarter earnings report to include indications on cost-cutting plans and how its most profitable markets and products are doing globally.
Analysts have estimated earnings at $1.11 cents per share on $21.86 billion in revenues for the October-through-December quarter.
The Procter & Gamble Company (NYSE:PG) has estimated second-quarter earnings, excluding one-time items, between $1.07 to $1.13 per share on revenue at $21.9 billion to $22.3 billion.
This compares to the previous year’s earnings of 57 cents per share ($1.10 per share excluding one-time items) on $22.14 billion in revenues.
Critical to the stock will be PG guidance for organic sales and market share in the 3Q and 2H. We see acceleration into the 2H on easier comps, but little upside vs guidance. PG is desperate to stabilize and then grow market share. PG has been revving up innovations and marketing in core categories where it has been losing share in recent quarters. In these sectors, as of Dec. 22 Nielsen data, PG gained share sequentially but still lost share year over year in blades and oral care, which many consider
disappointing. PG’s detergents gained share but still were down in a contracting category.
For the three months ended 30 September 2012, The Procter & Gamble Company (NYSE:PG) revenues decreased 4% to $20.74B. Net income applicable to common stockholders excluding extraordinary items decreased 5% to $2.76B. Revenues reflect Beauty segment decrease of 7% to $4.94B, Fabric & Home Care segment decrease of 2% to $6.9B. Dividend per share increased from $0.53 to $0.56.
Analysts have become more bullish on the stock with projected earnings now at 19 cents per share.
The current Street estimate is 35.7% higher than same quarter a year ago with 14 cents per share earnings.
For the fiscal year, analysts are estimating earnings at 51 cents per share while revenue is projected to exceed the previous year’s $1.61 billion total by 11.5% to hit $1.8 billion. For the year, revenue has been estimated at $6.83 billion.
Weyerhaeuser Company (NYSE:WY) has seen two straight quarters of rising revenue: in the third quarter, revenue jumped 12.9% to $1.77 billion year-over-year and in the second quarter, it rose 11.4%.
For the 39 weeks ended 30 September 2012, Weyerhaeuser Company (NYSE:WY) revenues increased 6% to $5.06B. Net income before extraordinary items decreased 5% to $242M. Revenues reflect Wood Products segment increase of 35% to $816M, Real Estate and Related Assets segment increase of 9% to $230M, Timberlands segment increase of 6% to $267M. Net income was offset by Cellulose Fibers segment income decrease of 45% to $75M.
From the analysts’ optimism for the stock, “Buy” ratings have increased in the last three months.