Will Crown Holdings, Inc. (CCK) Beat Earnings Estimates?

We expect Crown Holdings, Inc. CCK, the supplier of packaging products to consumer marketing companies, to beat expectations when it reports second-quarter 2014 results before the market opens on Jul 21.
 
Why a Likely Positive Surprise?
 
Our proven model shows that Crown Holdings may beat earnings because it has the right combination of two key components.
 
Positive Zacks ESP: V. F. Corp. currently has an Earnings ESP of +4.00%. This is because the Most Accurate estimate stands at $1.04 per share, while the Zacks Consensus Estimate is pegged at $1.00.
 
Zacks Rank #2 (Buy): Note that stocks with a Zacks Rank #1, 2 and 3 have a higher chance of beating earnings. The Sell-rated stocks (#4 and 5) should never be considered going into an earnings announcement.
 
The combination of V. F. Corp.'s Zacks Rank #2 (Buy) and Earnings ESP of +4.00% makes us confident of a positive earnings beat.
 
What is Driving Better-than-Expected Earnings? 
 
Crown Holdings acquired Mivisa, a leading Spanish manufacturer of two- and three-piece food cans, at April end. The acquisition will significantly enhance Crown Holdings position in the European food can segment. The buyout will boost margins and is expected to be accretive to earnings in 2014.
 
Further, Crown Holdings has embarked on a cost-reduction initiative to better align costs primarily in its food, aerosol and specialty packaging businesses, as a result of which approximately 235 employees will be laid off, in 2014. This will lead to annual cost savings of approximately $25 million.
 
Crown Holdings' estimates have undergone positive revisions following its first-quarter earnings results. Notably, Crown Holdings reported a 14% year-over-year rise in its first-quarter 2014 adjusted earnings to 57 cents per share, surpassing the Zacks Consensus Estimate of 51 cents per share.
 
For the second quarter of 2014, the company expects earnings per share between 90 cents and $1.00, excluding any impact from the Mivisa acquisition. Including the impact of Mivisa acquisition and excluding the impact of share repurchases, full-year earnings per share are expected to exceed the previous guidance of $3.15 to $3.35.
 
Crown Holdings has topped the Zacks Consensus Estimate in three of the trailing four quarters with an average positive surprise of 3.91%. In the last concluded quarter, the company outpaced the Zacks Consensus Estimate by 11.76%.
 
Other Stocks to Consider
 
Crown Holdings is not the only company which is looking up this earnings season. The following companies are also likely to beat earnings in the to-be-reported quarter: 
 
Ball Corporation BLL with an Earnings ESP of +0.98% holds a Zacks Rank #2 (Buy).
 
Graphic Packaging Holding Company GPK has an Earnings ESP of +5.88% and a Zacks Rank #2. 
 
International Paper Company IP has an Earnings ESP of +2.44% and a Zacks Rank #3 (Hold).

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