Around 84 S&P 500 companies have reported third-quarter 2018 results as of Oct 19, continuing the strong momentum seen in the previous earnings season. Total earnings for these companies are up 19.2% year over year on 8.4% higher revenues, with 82.1% beating earnings estimates and 61.9% surpassing top-line expectations. Based on the hitherto observed pattern, the third quarter is anticipated to register improvement in both earnings and revenues.

Per the latest Earnings Preview, overall earnings for the S&P 500 companies are expected to rise 19.2% on 7.2% revenue growth. This signifies that the strong growth pace of the last few quarters is still intact, though it has started to decelerate.

Notably, earnings growth is expected to be in double-digits on a year-over-year basis for 10 of the 16 Zacks sectors. Only two sectors (Autos & Conglomerates) are expected to show earnings declines in the to-be-reported quarter.

For the Conglomerates sector, earnings are expected to fall 4.4% and sales are projected to decrease 1.9% (as on Oct 17). Meanwhile, with the global economic growth pace expected to be a bit weaker compared to earlier expectation and ongoing trade issue still largely unsettled, the major U.S. industrials are likely to be affected. This is likely to weigh on the companies’ margins in the sector.

Let’s take a sneak peek at two major Conglomerate stocks scheduled to report third-quarter 2018 earnings on Oct 23 and see how things are shaping up for the upcoming results.

3M Company MMM is scheduled to report results before the opening bell. The company is likely to report higher industrial segment profit in the quarter backed by strong automotive solutions, industrial adhesives as well as its automotive businesses. The Zacks Consensus Estimate for third-quarter revenues from 3M’s Industrial segment is pegged at $3,134 million, higher than $2,764 million reported in the year-ago quarter.

However, of late, rising cost of sales has been a major cause of concern for 3M over the last few quarters, and it remains susceptible to commodity price risks. Additionally, the company is concerned about adverse currency translations, which may be a drag on its profitability. (Read more: 3M to Report Q3 Earnings: What’s in the Cards?)

3M Company Price and EPS Surprise

3M Company Price and EPS Surprise | 3M Company Quote

For the third quarter, the company’s earnings are expected to improve 15.9% year over year on 3% higher revenues. Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate is -0.49%, with the former pegged at $2.69 and the latter at $2.70. This combined with a Zacks Rank #4 (Sell), makes an earnings surprise prediction difficult for the stock. This is because a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to beat estimates. You can see the complete list of today’s Zacks #1 Rank stocks here.

As it is, we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

United Technologies Corporation UTX is also scheduled to report results before the opening bell. In the quarter, the company’s earnings are expected to rise 4.6% year over year on 7.2% higher revenues. Strength in Otis, Climate Control and Security, Pratt & Whitney, as well as the aerospace businesses will likely drive the company’s top line.

The Zacks Consensus Estimate for UTC Aerospace Systems segment’s revenues is pegged at $3,700 million, up from $3,637 million reported a year ago. Further, Pratt & Whitney segment’s revenues are likely to come in at $4,300 million compared with $3,871 million reported in the year-ago quarter.

Our proven model shows that United Technologies is likely to beat earnings this quarter as it possesses the key components. Earnings ESP for the company is +0.14%, where the Most Accurate Estimate and the Zacks Consensus Estimate currently pegged at $1.82 and $1.81, respectively. Moreover, United Technologies has a Zacks Rank #2. (Read More: United Technologies’ Q3 Earnings: What’s in the Cards?).

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

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