Ingersoll Rand (NYSE:IR) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

Ingersoll Rand Inc. (NYSE:IR) is scheduled to report Q3 earnings results after markets close for trading on November 2, 2020.

The company is expected to report earnings of $0.31/share on revenue of $1.267 billion. The consensus earnings per share (EPS) of $0.31/share is based on a poll of 14 analysts and represents a decline in eps of −25.6% over the same quarter last year, when the company reported earnings of $0.41/share.

The revenue forecast of $1.267 billion based on a poll of 8 analysts implies a year-over-year (YoY) growth in revenue of 112.3%. Last year the company reported $596.7 million in revenue for the quarter.

Expected to report EPS contraction of −25.6% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $1,266.57 $596.70 112.3%
EPS $0.31 $0.41 −25.6%

Earnings Call Trends

Historically, management has exceeded analyst expectations 7 out of the last 8 tracked quarters, and missed expectations 1 quarters.

What are your expectations from Ingersoll Rand Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.20 $0.31 53.9% Beat
Q1, 2020 $0.27 $0.25 −7.6% Missed
Q4, 2019 $0.34 $0.37 8.4% Beat
Q3, 2019 $0.38 $0.41 7.6% Beat
Q2, 2019 $0.39 $0.43 10.7% Beat
Q1, 2019 $0.34 $0.38 11.0% Beat
Q4, 2018 $0.53 $0.57 8.3% Beat
Q3, 2018 $0.48 $0.49 1.8% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 3.4%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 3, 2020 $31.59 $32.65 3.4% Increase
May 12, 2020 $29.09 $25.92 −10.9% Decline
February 17, 2020 $36.83 $37.55 2.0% Increase
October 28, 2019 $32.79 $33.02 0.7% Increase

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −1.74, the model suggests that the company is likely an earnings manipulator. A value of −1.74 implies a 4.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

Ingersoll Rand Inc. is currently trading at $36.56/share, down −4.5% for the day. The company is trading at approximately 93.8% of its 52-week high of $38.96/share. The company’s stock price is up 12.0% since the last earnings report and down −1.8% over the previous week.

The company’s 14 Day Relative Price Index (RSI) of 47.74 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:IR Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −103.44 and a forward P/E multiple of 30.11.

Ingersoll Rand Inc.’s current share price also implies a price-to-book (P/B) multiple of 1.78. The following table summarizes some other key fundamental ratios:

Data as of October 27, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $36.56
P/E Ratio −103.4x
P/E Ratio (Fwd) 30.1x
PEG Ratio 0.8
Total Debt / Total Capital 20.1%
Levered Free Cash Flow $485.1 million
EV / EBITDA 35.6x

Finbox

Ingersoll Rand Inc. is a large-cap stock with a market capitalization of $15.248 billion and a total enterprise value of $18.172 billion. The company operates in the Industrials sector and the Machinery industry.

Ingersoll Rand Inc. provides mission-critical flow control and compression equipment, and associated aftermarket parts, consumables, and services in the United States, Europe, the Middle East, Africa, and the Asia Pacific. It operates through three segments: Industrials, Energy, and Medical. The Industrials segment designs, manufactures, markets, and services a range of air compression, vacuum, and blower products, as well as offers associated aftermarket parts, consumables, and services. Its products are used in process-critical applications, such as the operation of industrial air tools, vacuum packaging of food products, aeration of waste water, and others. This segment sells its products through an integrated network of direct sales representatives and independent distributors under the Gardner Denver, CompAir, Elmo Rietschle, Robuschi, and other brand names. The Energy segment designs, manufactures, markets, and services a range of displacement and liquid ring vacuum pumps, compressors and integrated systems, and engineered fluid loading and transfer equipment, as well as offers associated aftermarket parts, consumables, and services under the Gardner Denver, Nash, Emco Wheaton, and other brands. This segment serves customers in upstream, midstream, and downstream energy markets, as well as petrochemical processing, transportation, and general industrial sectors. The Medical segment designs, manufactures, and markets a range of specialized gas, liquid, and precision syringe pumps and compressors under the Thomas and other brands for use in oxygen therapy, blood dialysis, patient monitoring, laboratory sterilization and wound treatment, and other applications. The company was formerly known as Gardner Denver Holdings, Inc. and changed its name to Ingersoll Rand Inc. in March 2020. Ingersoll Rand Inc. was founded in 1859 and is based in Davidson, North Carolina.

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