CNH Global NV Third Quarter Earnings Sneak Peek

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CNH Global NV (ADR) (NYSE:CNH) will unveil its latest earnings on Wednesday, October 31, 2012. CNH Global is a global, full-line company in both the agricultural and construction equipment industries with positions in many significant geographic and product categories in both agricultural and construction equipment.

CNH Global NV (ADR) Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $1.16 per share, a rise of 2.7% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.25. Between one and three months ago, the average estimate moved down. It also has dropped from $1.21 during the last month. Analysts are projecting profit to rise by 16.4% compared to last year’s $4.46.

Past Earnings Performance: The company missed estimates last quarter after beating forecasts in the prior two. In the second quarter, the company reported net income of $1.47 per share versus a mean estimate of profit of $1.48 per share. In the first quarter, the company beat estimates by 38 cents.

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A Look Back: In the second quarter, profit rose 10.9% to $355 million ($1.47 a share) from $320 million ($1.33 a share) the year earlier, but fell short analyst expectations. Revenue rose 8.2% to $5.28 billion from $4.88 billion.

Stock Price Performance: Between August 1, 2012 and October 25, 2012, the stock price rose $4.14 (10.8%), from $38.27 to $42.41. The stock price saw one of its best stretches over the last year between December 30, 2011 and January 11, 2012, when shares rose for eight straight days, increasing 17.2% (+$6.18) over that span. It saw one of its worst periods between February 21, 2012 and February 29, 2012 when shares fell for seven straight days, dropping 3.9% (-$1.74) over that span.

Analyst Ratings: There are mostly holds on the stock with four of six analysts surveyed giving that rating.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 20.7% in the third quarter of the last fiscal year, 17.6% in the fourth quarter of the last fiscal year and 20% in the first quarter before increasing again in the second quarter.

This upcoming earnings announcement will be a chance to build on positive earnings momentum over the last two quarters. In the first quarter, profit rose 77% before increasing in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.29 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 3.45 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 3.7% to $7.64 billion while assets decreased 0.9% to $25.18 billion.

Wall St. Revenue Expectations: On average, analysts predict $4.57 billion in revenue this quarter, a decline of 0.9% from the year-ago quarter. Analysts are forecasting total revenue of $18.89 billion for the year, a rise of 4.6% from last year’s revenue of $18.06 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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