WestRock (WRK) to Report Q1 Earnings: What's in the Offing?

WestRock Company WRK is lay ought interpret first-quarter fiscal 2019 results can Jan 31, ago the opening bell.

In the persist reported quarter, the corporation delivered year-over-year improvement can both its sumit and bottom line. allowance and revenues either conquer the respective Zacks Consensus Estimate.

Notably, WestRock’s allowance outpaced estimates can three of the trailing four quarters, still coming can line can one. The corporation has median definite amaze of 5.96%.

WestRock corporation charge and EPS Surprise

WestRock corporation price-eps-surprise | WestRock corporation Quote

Let’s look how things are shaping up foregoing ought this announcement.

Factors can Play

WestRock will advantage from favorable demand, charge and mixture trends across its paper and packaging businesses can the first belt of fiscal 2019. The Zacks Consensus appraise though sum revenues is pegged can $4.6 billion can the fiscal first quarter, projecting year-over-year growth of 18%.

WestRock is likely ought look sales growth can its main segments — Consumer Packaging and Corrugated Packaging. The Zacks Consensus appraise though revenues though the Consumer Packaging portion is pegged can $1,779 million though the fiscal first quarter, indicating year-over-year increase of 1%. The Zacks Consensus appraise though revenues though the Corrugated Packaging portion is currently pegged can $2,740 million, reflecting year-over-year arise of 26%. The dust & development portion is expected ought interpret revenues of $12 million can the belt under review, up 9% year can year. Pricing will exist higher can both segments though a arise of previously announced charge increases. However, volumes will exist lower due ought seasonality can the consumer business.

The Consumer Packaging segment’s adjusted EBITDA is estimated ought inch up 1% year can year ought $237 million. The Corrugated Packaging segment’s adjusted EBITDA is likely ought wave 23% ought $528 million. The dust & development portion is projected ought mail operating amuse of $2 million, against a loss of $0.6 million reported can the prior-year quarter.

WestRock projects adjusted portion EBITDA can the first belt fiscal of 2019 ought exist among $737 million and $767 million, lower than the $802 million reported can fourth-quarter fiscal 2018. The KapStone acquisition is likely ought further approximately $90 million can adjusted portion EBITDA. A scheduled maintenance downtime across corrugated and consumer mills of 60,000 tons and two fewer shipping days can the box affair will either shock EBITDA can the to-be-reported quarter. still input costs will linger firm sequentially, higher people insurance spend and refuse can non-cash pension revenue will shock EBITDA by $20 million sequentially. Productivity and action improvement programs along with cost-saving actions linger tailwinds.

However, lost manufacture resulting from the storm Michael is likely ought eat a negative shock of $45 million can EBITDA. Moreover, higher depreciation and amortization expenses, higher employ expense, an adjusted tax impose of 24.5% and a slightly higher part calculate is likely ought eat a negative shock of 29 cents can first-quarter fiscal 2019 allowance per share.

The Zacks Consensus appraise though allowance is pegged can 81 cents, indicating a year-over-year refuse of 7%.

Earnings Whispers

Our proven model does no emerge that WestRock is likely ought conquer allowance estimates this quarter. This is though a stock needs ought eat both — a definite allowance ESP and a Zacks degree #1 (Strong Buy), 2 (Buy) or 3 (Hold) — though this ought happen. That is no the example here though you will look below.

Earnings ESP: The allowance ESP, which represents the distinction among the Most precise appraise and the Zacks Consensus Estimate, is -0.49%. You can disclose the best stocks ought buy or sell ago they’re reported with our allowance ESP Filter.

Zacks Rank: WestRock has a Zacks degree #3. This combined with a negative ESP makes allowance amaze prediction difficult.