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AptarGroup (ATR) Down 1.2% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for AptarGroup (ATR - Free Report) . Shares have lost about 1.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is AptarGroup due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
AptarGroup Q4 Earnings & Sales Beat Estimates, Up Y/Y
AptarGroup’s adjusted earnings per share was 92 cents in fourth-quarter 2020, surpassing the Zacks Consensus Estimate of 90 cents. The bottom line also improved 8% year over year.
On a reported basis, earnings came in at 79 cents per share compared with the year-ago quarter’s 73 cents per share.
Total revenues increased 12% year over year to $749 million during the reported quarter. The top line also beat the Zacks Consensus Estimate of $736 million. Core sales, excluding currency and acquisition effects, increased 5% year over year. Solid underlying demand for medicines drove sale growth in the Pharma segment. Demand for active packaging solutions used with healthcare applications also increased. Further, the company witnessed continued strong demand from personal care and home care markets. This was offset by weakness in beauty markets and lower custom tooling sales.
Operational Update
Cost of sales climbed 8% year over year to $470 million. Gross profit increased 18% year over year to $279 million. Gross margin surged 37.3% during the fourth quarter compared with the prior-year quarter’s 35.1%.
Selling, research, development and administrative expenses flared up 19% year over year to $129 million. Adjusted operating income advanced 15% year over year to $84 million. Operating margin came in at 11.2% in the reported quarter, up from the year-ago quarter’s 10.9%. Adjusted EBITDA increased 14% year on year to $149 million in the October-December quarter.
Segmental Performance
Total revenues in the Beauty + Homes segment grew 7% year over year to $337 million. Adjusted operating income in the third quarter plunged 38% year over year to $10.6 million.
Total revenues in the Pharma segment rose 17% year over year to $312 million. Adjusted operating income amounted to $84 million for the December-end quarter compared with the year-earlier quarter’s $76 million.
Total revenues in the Food + Beverage segment increased 13% year over year to $101 million. Operating income was $8.7 million in fourth-quarter 2020, reflecting a substantial improvement from $2.2 million in the year-ago quarter.
Financial Performance
AptarGroup reported cash and cash equivalents of $300 million as of Dec 31, 2020, up from $242 million as of Dec 31, 2019. The company generated $570 million of cash flow from operations in the 2020 compared with the $514 million witnessed last year. As of Dec 31, 2020, long-term debt was approximately $1,055 million, down from $1,085 million as of Dec 31, 2019.
2020 Results
AptarGroup’s adjusted earnings per share in 2020 was $3.65, down 19% from the prior-year’s figure of $4.01. However, the bottom line beat the Zacks Consensus Estimate of $3.63. Including one-time items, the company delivered an earnings per share of $3.21 in 2020 compared with $3.66 in 2019. Sales increased 2% year over year to $2,929 million from the prior-year figure of $2,860 million. The top line surpassed the Zacks Consensus Estimate of $2,920 million.
Outlook
AptarGroup estimates first-quarter 2021 adjusted earnings per share in the range of 86 cents to 94 cents.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -12.62% due to these changes.
VGM Scores
Currently, AptarGroup has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, AptarGroup has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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AptarGroup (ATR) Down 1.2% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for AptarGroup (ATR - Free Report) . Shares have lost about 1.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is AptarGroup due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
AptarGroup Q4 Earnings & Sales Beat Estimates, Up Y/Y
AptarGroup’s adjusted earnings per share was 92 cents in fourth-quarter 2020, surpassing the Zacks Consensus Estimate of 90 cents. The bottom line also improved 8% year over year.
On a reported basis, earnings came in at 79 cents per share compared with the year-ago quarter’s 73 cents per share.
Total revenues increased 12% year over year to $749 million during the reported quarter. The top line also beat the Zacks Consensus Estimate of $736 million. Core sales, excluding currency and acquisition effects, increased 5% year over year. Solid underlying demand for medicines drove sale growth in the Pharma segment. Demand for active packaging solutions used with healthcare applications also increased. Further, the company witnessed continued strong demand from personal care and home care markets. This was offset by weakness in beauty markets and lower custom tooling sales.
Operational Update
Cost of sales climbed 8% year over year to $470 million. Gross profit increased 18% year over year to $279 million. Gross margin surged 37.3% during the fourth quarter compared with the prior-year quarter’s 35.1%.
Selling, research, development and administrative expenses flared up 19% year over year to $129 million. Adjusted operating income advanced 15% year over year to $84 million. Operating margin came in at 11.2% in the reported quarter, up from the year-ago quarter’s 10.9%. Adjusted EBITDA increased 14% year on year to $149 million in the October-December quarter.
Segmental Performance
Total revenues in the Beauty + Homes segment grew 7% year over year to $337 million. Adjusted operating income in the third quarter plunged 38% year over year to $10.6 million.
Total revenues in the Pharma segment rose 17% year over year to $312 million. Adjusted operating income amounted to $84 million for the December-end quarter compared with the year-earlier quarter’s $76 million.
Total revenues in the Food + Beverage segment increased 13% year over year to $101 million. Operating income was $8.7 million in fourth-quarter 2020, reflecting a substantial improvement from $2.2 million in the year-ago quarter.
Financial Performance
AptarGroup reported cash and cash equivalents of $300 million as of Dec 31, 2020, up from $242 million as of Dec 31, 2019. The company generated $570 million of cash flow from operations in the 2020 compared with the $514 million witnessed last year. As of Dec 31, 2020, long-term debt was approximately $1,055 million, down from $1,085 million as of Dec 31, 2019.
2020 Results
AptarGroup’s adjusted earnings per share in 2020 was $3.65, down 19% from the prior-year’s figure of $4.01. However, the bottom line beat the Zacks Consensus Estimate of $3.63. Including one-time items, the company delivered an earnings per share of $3.21 in 2020 compared with $3.66 in 2019. Sales increased 2% year over year to $2,929 million from the prior-year figure of $2,860 million. The top line surpassed the Zacks Consensus Estimate of $2,920 million.
Outlook
AptarGroup estimates first-quarter 2021 adjusted earnings per share in the range of 86 cents to 94 cents.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month. The consensus estimate has shifted -12.62% due to these changes.
VGM Scores
Currently, AptarGroup has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, AptarGroup has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.