Diversified electronics manufacturer Amphenol Corporation APH is scheduled to report second-quarter 2017 results before the opening bell on Jul 26. In the last reported quarter, adjusted earnings comfortably exceeded the Zacks Consensus Estimate by 5 cents. Amphenol surpassed earnings estimates in each of the trailing four quarters with an average positive earnings surprise of 5.6%. Let's see how things are shaping up for the upcoming results.

Key Factors in the Quarter

Amphenol’s top-line growth is expected to benefit from improved end-market demand, new product rollouts and market share gains. Demand continues to be strong in automotive industrial, mobile networks and military markets. The diversification in end markets with a consistent focus on technology innovation and customer support through all phases of the economic cycle is likely to help the company achieve solid top-line growth.

Amphenol remains encouraged by its expanding presence in the fast-growing commercial aerospace market and is well positioned to capitalize on the proliferation of electronics content on next-generation planes. These advanced electronic systems require new higher technology interconnect solutions to enhance fuel efficiency and improve passenger experience, all of which create excellent opportunities for Amphenol.

In order to fuel further growth, Amphenol aims to make acquisitions on a global basis in the high-growth segments that have complementary capabilities from a product, customer and/or geographic standpoint. Amphenol also expects to leverage on the solid growth potential of the acquired companies to drive robust performance. A balanced organic and inorganic growth model, a lean and flexible cost structure, and an agile and entrepreneurial management team augur well for the company. For the to-be-reported quarter, Amphenol expects adjusted earnings of 70–72 cents per share on revenues of $1.580–$1.620 billion. We expect the company to record year-over-year growth of 10.3% and 3.6% in earnings and revenues, respectively, in the second quarter.

Earnings Whispers

Our proven model does not conclusively show that Amphenol is likely to beat earnings this quarter as it does not possess the key components. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:

Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00% as both are currently pegged at 72 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Amphenol Corporation Price and EPS Surprise

Amphenol Corporation Price and EPS Surprise | Amphenol Corporation Quote

Zacks Rank: Amphenol’s Zacks Rank #2 when combined with a 0.00% ESP makes an earnings prediction uncertain.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.

Stocks to Consider

Here are some other companies 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:

United Technologies Inc. UTX, with an Earnings ESP of +2.26% and a Zacks Rank #3.

3M Company MMM, with an Earnings ESP of +1.16% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Waste Management Inc. WM, with an Earnings ESP of +1.22% and a Zacks Rank #2.

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