Sensient Technologies Earnings Preview

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Sensient Technologies (NYS: SXT) will try to beat its earnings estimates for the fifth consecutive quarter. The company will unveil its latest earnings Tuesday. Sensient Technologies is a global manufacturer and marketer of colors, flavors, and fragrances.

What analysts say:

  • Buy, sell, or hold?: Half of analysts think investors should stand pat on Sensient Technologies while the remaining half rate the stock as a buy. That rating hasn't budged in three months as analysts have remained steady in their opinion of the stock.
  • Revenue forecasts: On average, analysts predict $352.6 million in revenue this quarter. That would represent a rise of 3.9% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.56 per share. Estimates range from $0.54 to $0.58.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 93.1% giving it an "outperform" rating. The community at large agrees with the All-Stars, with 93.7% assigning it a rating of "outperform." Fools are gung-ho about Sensient Technologies, though the message boards have been quiet lately with only 26 posts in the past 30 days. Sensient Technologies has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Sensient Technologies' profit has risen year-over-year by an average of 24.2% over the past five quarters. Revenue has now gone up for three straight 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 company's net margins have been increasing year-over-year for the last four quarters. Net margins reflect what percentage of revenue becomes profit. See how Sensient Technologies has been doing for the last four quarters:

Quarter

Q3

Q2

Q1

Q4

Gross Margin

31.5%

31.6%

30.8%

30.1%

Operating Margin

13.7%

14.4%

12.5%

12.1%

Net Margin

8.8%

8.9%

7.6%

7.6%

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Earnings estimates provided by Zacks.

At the time this article was published

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