What's In The Cards For FLIR Systems' (FLIR) Q3 Earnings?

FLIR Systems Inc. (NASDAQ:FLIR) is set to report third-quarter 2019 financial results on Oct 31, before market open. In the trailing four quarters, the company came up with an average positive earnings surprise of 3.89%.

Sales growth in the company’s Government & Defense and Industrial business units is likely to have driven overall revenues in the quarter to be reported.

Let's take a closer look at the factors influencing FLIR Systems’ quarterly results.

Factors at Play

The company's Government & Defense business unit has been witnessing robust growth led by frequent product innovation and bookings, which, in turn, result in solid organic revenue growth. Keeping in these lines, during the third quarter, FLIR System unveiled its T860 high-performance thermal camera, which helps in streamlining the inspections of critical assets.

Thus, we anticipate the trend to have boosted this segment’s third-quarter performance as well. The Zacks Consensus Estimate for the segment’s revenues in the third quarter is pegged at $212 million, indicating growth of 23.3% from the year-ago quarter’s reported figure.

Frequent product innovation and robust order bookings leading to solid organic revenue growth usually boost the company’s top line. Notably, for the first half of 2019, total bookings rose 14%.

The company’s top line might reflect growth, suggesting such trends to have continued during the third quarter. In line with this, the Zacks Consensus Estimate for third-quarter revenues is pegged at $486 million, indicating an 11.7% improvement from the year-ago quarter’s reported number.

During the second-quarter earnings call, FLIR Systems had mentioned its anticipation of witnessing positive contributions in the third quarter as well from the acquisitions of Endeavor Robotics and Aeryon Labs.

This, along with positive revenue growth expectations, makes us optimistic about the company’s bottom-line performance for the soon-to-be-reported quarter. Thus, the consensus mark for the company’s third-quarter earnings stands at 58 cents, implying a 1.8% improvement from the year-ago quarter’s reported number.

What the Zacks Model Unveils

Our proven model doesn't conclusively predict an earnings beat for FLIR Systems this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that's not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

FLIR Systems has an Earnings ESP of -2.01% and a Zacks Rank #4.

FLIR Systems, Inc. Price and EPS Surprise

Stocks That Warrant a Look

Here are some companies in the Zacks Aerospace sector that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this quarter:

Leidos Holdings Inc. (NYSE:LDOS) is scheduled to report third-quarter 2019 results on Oct 29. The company has an Earnings ESP of +1.52% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Huntington Ingalls Industries, Inc. (NYSE:HII) is expected to report third-quarter 2019 results around Nov 7. The company has an Earnings ESP of +2.09% and carries a Zacks Rank #3.

Recent Defense Releases

Northrop Grumman Corporation (NYSE:NOC) reported third-quarter 2019 earnings of $5.49 per share, which surpassed the Zacks Consensus Estimate of $4.74 by 15.8%. However, the bottom line declined 22.8% from $7.11 per share reported in the year-ago quarter.

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