Will Trimble Navigation (TRMB) Beat this Earnings Season? - Analyst Blog

Trimble Navigation Limited TRMB is set to report first-quarter 2014 results on May 6. Last quarter, it posted a 21.2% positive surprise. Let's see how things are shaping up for this announcement.

Growth Factors This Past Quarter

Trimble Navigation delivered encouraging fourth quarter 2013 results with both the top and bottom lines exceeding the Zacks Consensus Estimate. Revenues were primarily driven by strong performance in the Engineering and Construction (E&C), Field Solutions and Mobile Solutions TMS segments.

Moreover, Trimble is seeing much stronger construction markets and a few of its businesses have started witnessing normal seasonality. Also, Trimble has made a number of acquisitions in the recent months, which are helping it to build a strong product portfolio and position itself in markets with better growth prospects.

The company also launched several new products and solutions that should help it increase penetration in existing markets and expand into new ones. This, along with its improving end markets, will boost its market share.

However, the company is experiencing softness in certain areas of the business owing to macro concerns and the nature of the new business acquired. Despite softness in some markets, Trimble's solid portfolio (enhanced by acquisitions), strong market position and strategic partnerships will continue to drive both revenues and earnings over the next few quarters.

Earnings Whispers?

Our proven model does not conclusively show that Trimble Navigation will beat estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. That is not the case here as you will see below.

Zacks ESP: Both the Most Accurate estimate and the Zacks Consensus Estimate stand at 46 cents. Hence, the difference is 0.00%.

Zacks Rank: Trimble Navigation's Zacks Rank #2 (Buy), when combined with a 0.00% ESP makes surprise prediction difficult.

We caution against stocks with Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Other Stocks to Consider

Here are some other companies, which you may want to consider as our model shows that they have the right combination of elements to post an earnings beat this quarter:

• Inteliquent, Inc. IQNT, with Earnings ESP of +4.00% and a Zacks Rank #1 (Strong Buy)
• Infinera Corp. INFN with Earnings ESP of +33.33% and a Zacks Rank #2 (Buy)
• BlackBerry Ltd. BBRY with Earnings ESP of +21.43% and a Zacks Rank #2