If Lufkin Industries (Nasdaq: LUFK) misses estimates again, it will be the third consecutive quarter. The company is a supplier of oil field and power transmission products and is divided into two operating segments: oil fields and power transmission. It will unveil its latest earnings on Wednesday, July 20. 

What analysts say:

  • Buy, sell, or hold?: Analysts generally think investors should hang on to Lufkin Industries, with half rating the stock a hold. Analysts don't like Lufkin Industries as much as competitor Dril-Quip overall. Eight out of 11 analysts rate Dril-Quip a buy, compared with two of four for Lufkin Industries. Wall Street has warmed to the stock over the past three months, with analysts increasing their endorsement from hold to a moderate buy.
  • Revenue forecasts: On average, analysts predict $214.7 million in revenue this quarter. That would represent a rise of 40.5% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.68 per share. Estimates range from $0.62 to $0.75s.

What our community says:
CAPS All-Stars are solidly backing the stock, with 100% giving it an "outperform" rating. The community at large agrees with the All Stars, with 97.8% awarding it a rating of "outperform." Fools have embraced Lufkin Industries and haven't been shy with their opinions lately, logging 186 posts in the past 30 days. Lufkin Industries has a bullish CAPS rating of five out of five stars that is about on par with the Fool community's assessment.

Management:
Lufkin Industries' profit has risen year over year by an average of more than twofold.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters. 

Quarter Q1 Q4 Q3 Q2
Gross Margin 23.8% 25.4% 25.2% 24.4%
Operating Margin 10% 11.1% 11.5% 11.1%
Net Margin 6.4% 7.5% 7.3% 6.9%
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