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Factors Likely to Influence Technoglass's (TGLS) Q3 Earnings

Tecnoglass, Inc. TGLS is expected to report year-over-year growth in its top and bottom lines when it releases third-quarter 2021 results on Nov 8, before market open.

The Zacks Consensus Estimate for third-quarter earnings is pegged at 34 cents, which suggests growth of 21.4% from the prior-year quarter’s reported figure. The consensus estimate for quarterly earnings has been unchanged in the past 30 days. The consensus mark for quarterly revenues is pegged at $117.6 million, implying a 13.9% increase from the prior-year quarter’s reported figure.

In the last reported quarter, the company delivered an earnings surprise of 36.7%. However, it has a trailing four-quarter earnings surprise of 42.6%, on average.

Factors to Note

Technoglass has been committed to offering better products with short lead times at affordable rates. It has been benefiting from an active residential and commercial construction environment in the United States. Sales in its Latin America market have also been gaining traction, owing to the recovery in construction activity. Strength in its single-family residential business as well as a robust pipeline of attractive commercial and multifamily projects bodes well.

Prestige and Elite product lines have likely been the key growth drivers for the single-family business. The company’s Multimax product line is also expected to have contributed to third-quarter sales. Technoglass has been making efforts to expand its single-family business via dealership expansion and geographic diversification, particularly in the high-growth Southeast U.S. region, the Gulf Coast and Texas. On its last reported quarter’s earnings call, management expected the single-family market performance to be ahead of expectations in the third quarter, driven by favorable residential demand.

The company has also been witnessing low mortgage rates and a solid construction environment in the United States markets. This along with strong economic and housing fundamentals has likely led to sturdy architectural glass demand.

On its last reported quarter’s earnings call, management expected positive business momentum for the second half of 2021, driven by the continued expansion of signal family residential and market share gains in the United States. The company also expected margins to be more than 30% in the third quarter on the back of more installation activity and an increase in the mix of its commercial revenues.

However, Technoglass continues to reel under industry-wide supply headwinds. The company is also facing elevated costs as a result of automation efforts to meet product demand. The rise in variable costs related to marine and ground transportation, and commissions is also expected to have been concerning.

Tecnoglass Inc. Price and EPS Surprise


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

What the Zacks Model Predicts

Our proven model does not conclusively predict an earnings beat for Tecnoglass this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Tecnoglass currently has a Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks With Favorable Combination

Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat:

Advance Auto Parts AAP has an Earnings ESP of +13.69% and it presently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Costco Wholesale Corporation COST has an Earnings ESP of +0.07% and a Zacks Rank #2 at present.

Stitch Fix SFIX currently has an Earnings ESP of +24.37% and a Zacks Rank #3.

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