Lufkin Industries Earnings Preview

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If Lufkin Industries (NAS: LUFK) misses estimates again it will be the fourth consecutive quarter for the company. The company will unveil its latest earnings on Wednesday. Lufkin Industries, a supplier of oil field and power transmission products, is divided into two operating segments: oil field and power transmission.

What analysts say:

  • Buy, sell, or hold?: The majority of analysts back Lufkin Industries as a buy. But with 66.7% of analysts rating it a buy, Lufkin Industries is still below the mean analyst rating of its nearest 10 competitors, which average 82.5% buys. Analysts don't like Lufkin Industries as much as competitor Newpark Resources overall. Eight out of nine analysts rate Newpark Resources a buy compared to two of three for Lufkin Industries. Analysts still rate the stock a Moderate buy, but they are a bit more wary about it compared to three months ago.
  • Revenue forecasts: On average, analysts predict $242.5 million in revenue this quarter. That would represent a rise of 40.9% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.58 per share. Estimates range from $0.56 to $0.60.

What our community says:
CAPS All-Stars are solidly backing the stock with 99.5% giving it an outperform rating. The community at large concurs with the All-Stars with 97.5% awarding it a rating of outperform. Fools are gung-ho about Lufkin Industries and haven't been shy with their opinions lately, logging 189 posts in the past 30 days. Lufkin Industries has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Lufkin Industries' profit has risen year over year by an average of more than twofold over the past five quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q2

Q1

Q4

Q3

Gross Margin

25.3%

23.8%

25.4%

25.2%

Operating Margin

12.8%

10.0%

11.1%

11.5%

Net Margin

8.1%

6.4%

7.5%

7.3%

For all our Lufkin Industries-specific analysis, including earnings and beyond, add Lufkin Industries to My Watchlist.

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At the time this article was published

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