Snap-on Gears Up for Q2 Earnings: What Lies Ahead for the Stock?

Snap-on Incorporated SNA is likely to witness top and bottom-line declines when it reports second-quarter 2025 earnings on July 17, before the opening bell. The Zacks Consensus Estimate for revenues is $1.2 billion, which indicates a drop of 2.2% from the year-ago quarter’s level.The consensus estimate for quarterly earnings has been stable over the past 30 days at $4.61 per share but indicates a decline of 6.1% from the year-earlier quarter’s tally. Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.The company has a negative trailing four-quarter earnings surprise of almost 1%, on average. It delivered a negative earnings surprise of 6.2% in the last reported quarter.Key Factors Likely to Influence SNA’s Q2 ResultsSnap-on has been reinforcing its business model through initiatives that enhance value creation across safety, service quality, customer satisfaction and innovation. The company’s strategic growth agenda includes expanding its franchise network, deepening relationships with repair shop owners and increasing its presence in emerging markets. Its focus on Rapid Continuous Improvement, a process aimed at boosting efficiency, controlling costs and enhancing organizational performance, is encouraging. SNA’s innovation pipeline remains strong, with ongoing investments in product development and global brand expansion.Despite such strengths, Snap-on faces several external challenges. Macroeconomic headwinds, geographic pressures in critical industries and geopolitical disruptions are likely to have weighed on the company’s performance. It battles persistent cost inflation from rising raw material and operational expenses, which poses a risk to profitability.In addition, Snap-on has been witnessing sluggishness in its Tools Group unit for a while, owing to lower activity in the U.S. operations and adverse foreign currency translations. We estimate a 4% decline in the Tools Group for the second quarter. Moreover, the company is not fully immune to the tariff-related headwinds.Nevertheless, Snap-on leverages its manufacturing strategy with quick adjustments to the evolving production landscapes. The automotive repair arena has been strong with household spending on repairs and substantial growth in car repairs. Management had expected SNA’s markets and operations to have considerable resilience against the uncertainties of the operating landscape, with continuous progress along its defined runways for growth. Our model predicts a 3% rise for the Repair Systems & Information Group for the second quarter.What the Zacks Model Predicts for SNAOur proven model doesn’t conclusively predict an earnings beat for Snap-on this time around. 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 before they’re reported with our Earnings ESP Filter.Snap-On Incorporated Price and EPS Surprise Snap-On Incorporated price-eps-surprise | Snap-On Incorporated QuoteSnap-on has an Earnings ESP of 0.00% and a Zacks Rank of 3.Valuation Picture of SNA StockFrom a valuation perspective, Snap-on offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 16.54x, which is below the five-year high of 18.63x and the Tools - Handheld industry’s average of 17.50x, the stock offers compelling value for investors seeking exposure to the sector.The recent market movements show that SNA’s shares have lost 4.8% in the past three months compared with the industry's 0.8% drop.Stocks Poised to Beat Earnings EstimatesHere are some companies, which according to our model, have the right combination of elements to post an earnings beat:Disney DIS currently has an Earnings ESP of +3.41% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here. DIS is likely to register bottom and top-line growth when it reports third-quarter fiscal 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $23.7 billion, indicating a 2.4% increase from the figure reported in the year-ago quarter. The consensus estimate for DIS’ fiscal third-quarter earnings is pegged at $1.47 per share, implying 5.8% growth from the year-ago quarter’s actual. The consensus mark has risen a couple of cents in the past 30 days.MGM Resorts International MGM currently has an Earnings ESP of +13.08% and a Zacks Rank of 3. MGM is likely to register a top-line drop when it reports second-quarter 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $4.3 billion, indicating a 0.9% drop from the figure reported in the year-ago quarter.The consensus estimate for MGM Resorts’ second-quarter earnings is pegged at 56 cents a share, implying a 34.9% decrease from the year-earlier quarter. The consensus mark has moved up a couple of cents in the past 30 days.lululemon athletica LULU currently has an Earnings ESP of +0.54% and a Zacks Rank of 3. LULU is likely to register top-line growth when it reports second-quarter fiscal 2025 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $2.5 billion, indicating 7.1% growth from the figure reported in the year-ago quarter.The consensus estimate for LULU’s second-quarter earnings is pegged at $2.87 a share, implying an 8.9% decrease from the year-earlier quarter. The consensus mark has dipped 1.4% in the past 30 days.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Snap-On Incorporated (SNA): Free Stock Analysis Report MGM Resorts International (MGM): Free Stock Analysis Report The Walt Disney Company (DIS): Free Stock Analysis Report lululemon athletica inc. (LULU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks