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Business Services Oct 28 Earnings Roster: V, MA, and More

In the third quarter of 2020, amid coronavirus-induced market uncertainty across the globe, the business services space benefited from increasing adoption and success of the work-from-home model, rising demand for risk mitigation and consulting services, and expertise to improve operational efficiency and reduce costs.

With the economy witnessing recovery, and both manufacturing and service activities gathering steam, demand is anticipated to have been in decent shape.

Although manufacturing activities edged down 0.6% from August to September, with the Purchasing Managers Index (PMI) measured by Institute for Supply Management (ISM) touching 55.4%, the reading stayed well above 50 — reflecting growth in the manufacturing sector. This is the fourth consecutive month of expansion after a two-month period of contraction that followed 122 straight months of expansion.

Notably, economic activity in the non-manufacturing sector expanded 0.9% from August to September as the Services PMI measured by ISM touched 57.8%. This is the fifth consecutive month of expansion after April’s contraction that had interrupted an impressive growth rally of 131 consecutive months.

Amid coronavirus-induced market uncertainty across the globe, the business services space has been benefiting from increasing adoption and success of the work-from-home model, rising demand for risk mitigation and consulting services, and expertise to improve operational efficiency and reduce costs. Notably, total earnings of the Zacks Business Services sector are expected to be up 0.4% on 5.3% lower revenues, per the Earnings Preview report.

V, MA, ADP, TT, WCN and ROL in Spotlight

Here we discuss six business services companies, scheduled to report their quarterly results on Oct 28.

Our quantitative model suggests that the combination of the following two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — increases the odds of a positive earnings surprise. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Visa V: This California-based payments technology company is scheduled to release fourth-quarter fiscal 2020 earnings after market close.

The Zacks Consensus Estimate for revenues is pegged at $5.02 billion, indicating decline of 18.2% from the year-ago quarter's reported figure. The consensus estimate for earnings stands at $1.09, implying a significant year-over-year decline of 25.9%. The company’s results are likely to be impacted by the coronavirus outbreak. Results are expected to have been partially offset by payments volume, processed transactions and cross-border volume.

Visa has an Earnings ESP of +0.30% and a Zacks Rank #3.

Visa Inc. Price and EPS Surprise

 

Visa Inc. price-eps-surprise | Visa Inc. Quote

Mastercard MA: This New York-based provider of transaction processing and other payment-related products and services is set to release third-quarter 2020 results before market opens.

The Zacks Consensus Estimate for Mastercard’s third-quarter revenues of $3.94 billion suggests an 11.8% decrease from the year-ago reported figure. Likewise, the consensus estimate for earnings of $1.64 per share indicates a 23.7% decline from the prior-year reported number.

Mastercard has an Earnings ESP of +2.26% and a Zacks Rank #3. (Read more: Will Higher Digital Spending Aid Mastercard Q3 Earnings?)

Mastercard Incorporated Price and EPS Surprise

Mastercard Incorporated price-eps-surprise | Mastercard Incorporated Quote

Automatic Data Processing, Inc. ADP: This New Jersey-based provider of cloud-based human capital management solutions is scheduled to report first-quarter fiscal 2021 results, before market open.

The Zacks Consensus Estimate for revenues stands at $3.30 billion, indicating a decline of 5.7% from the year-ago quarter’s reported figure. The top line is likely to have been weighed down by business losses, decrease in interest earned on funds held for clients and unfavorable impact of foreign-currency movements. These were, however, partially offset by new business started from New Business Bookings.

The consensus estimate for earnings stands at 97 cents, implying a year-over-year decline of 27.6%. The bottom line is expected to have been weighed down by decline in revenues combined with ADP's continued investment in sales, services and products. These were, however, partially offset by prudent expense management and cost savings related to transformation initiatives

Automatic Data Processing has an Earnings ESP of -0.28% and a Zacks Rank #3. (Read more: What Awaits Automatic Data Processing in Q1 Earnings?)

Trane Technologies TT: This Ireland-based provider of climate control solutions for buildings, homes, and transportation to report third-quarter 2020 results, before the bell.

The Zacks Consensus Estimate for revenues is pegged at $3.2 billion, indicating a decline of 26.4% from the year-ago quarter's reported figure. The consensus estimate for earnings stands at $1.34, implying a significant year-over-year decline of 32.7%.

Trane has an Earnings ESP of +2.49% and a Zacks Rank #3.

Trane Technologies plc Price and EPS Surprise

Trane Technologies plc price-eps-surprise | Trane Technologies plc Quote

Waste ConnectionsWCN: This Canada-based provider of waste collection, transfer, disposal, and recycling services is slated to release third-quarter 2020 results after market close.

The Zacks Consensus Estimate for revenues is pegged at $1.38 billion, indicating a decline of 2.1% from the year-ago quarter's reported figure. The consensus estimate for earnings stands at 66 cents, implying a significant year-over-year decline of 9.6%.

Waste Connections has an Earnings ESP of +0.32% and a Zacks Rank #3.

Waste Connections, Inc. Price and EPS Surprise

Waste Connections, Inc. price-eps-surprise | Waste Connections, Inc. Quote

Rollins, Inc.ROL: This Georgia-based provider of pest and termite control services to residential and commercial customers is scheduled to report third-quarter 2020 results, before the bell.

The Zacks Consensus Estimate for revenues is pegged at $574.7 million, indicating 3.3% year-over-year growth. Acquisitions, customer growth and pricing are likely to have driven the company’s top line in the to-be-reported quarter, offsetting impacts of coronavirus-led general reduction in demand for services.

The bottom line is likely to have been positively impacted by continued enhancements in routing and scheduling initiatives. With the consensus mark pegged at 23 cents, earnings are expected to increase 4.6% year over year.

Rollins has an Earnings ESP of 0.00% and a Zacks Rank #3. (Read more: Rollins to Post Q3 Earnings: What's in the Offing?)

Rollins, Inc. Price and EPS Surprise

Rollins, Inc. price-eps-surprise | Rollins, Inc. Quote

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Automatic Data Processing, Inc. (ADP): Free Stock Analysis Report
 
Mastercard Incorporated (MA): Free Stock Analysis Report
 
Visa Inc. (V): Free Stock Analysis Report
 
Waste Connections, Inc. (WCN): Free Stock Analysis Report
 
Rollins, Inc. (ROL): Free Stock Analysis Report
 
Trane Technologies plc (TT): Free Stock Analysis Report
 
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