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Is L3 Technologies (LLL) Poised To Beat In Q4 Earnings?

ByZacks Investment Research
Published 01/24/2019, 12:11 AM
Updated 07/09/2023, 06:31 AM

L3 Technologies Inc. (NYSE:LLL) is set to release fourth-quarter and 2018 results on Jan 29, before the market opens.

In the prior quarter, the company’s reported earnings came in line with our estimate. L3 Technologies has outperformed the Zacks Consensus Estimate in three of the trailing four quarters, the average positive surprise being 6.79%.

Let’s see how things are shaping up prior to this announcement.

Why a Likely Positive Earnings Surprise

Our proven model shows a likely earnings beat for L3 Technologies this quarter. That 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. This is the case here as you will see below.

Earnings ESP: L3 Technologies has an Earnings ESP of +1.19%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: L3 Technologies currently carries a Zacks Rank #3, which when combined with a positive ESP makes us confident of a probable earnings beat.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

L3 Technologies Inc. Price and EPS Surprise

L3 Technologies Inc. Price and EPS Surprise | L3 Technologies Inc. Quote

Factors at Play

During the month of October 2018, L3 Technologies and Harris Corporation (NYSE:HRS) announced the biggest ever defense merger, approximately worth $33.5 billion as per The Economist. From the context of year end results, the combined company for fiscal year 2018 is expected to generate net revenues of approximately $16 billion, Earnings before Interest and Taxes (EBIT) of $2.4 billion and free cash flows of $1.9 billion.

Considering, the aforementioned merger development, the Zacks Consensus estimate for L3 Technologies’ earnings of $2.66 reflects a 13.2% year-over-year rise for the upcoming quarterly result. Similarly, the Zacks Consensus Estimate for the company's revenue stands at $2.72 billion, implying a 5.8% year-over-year rise.

Stocks That Warrant a Look

Here are a few companies in the Zacks Aerospace Sector that have the right combination of elements to post an earnings beat this quarter.

Lockheed Martin Corporation (NYSE:LMT) is expected to report fourth-quarter 2018 results on Jan 29. The company has an Earnings ESP of +6.72% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

General Dynamics Corporation (NYSE:GD) is expected to report fourth-quarter 2018 results on Jan 30. The company has an Earnings ESP of +2.21% and a Zacks Rank #3.

Huntington Ingalls Industries (NYSE:HII) is expected to report fourth-quarter 2018 results on Feb 14. The company has an Earnings ESP of +11.85% and a Zacks Rank #3.

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General Dynamics Corporation (GD): Free Stock Analysis Report

Lockheed Martin Corporation (LMT): Free Stock Analysis Report

Huntington Ingalls Industries, Inc. (HII): Free Stock Analysis Report

L3 Technologies Inc. (LLL): Free Stock Analysis Report

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