We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Agco (AGCO) Down 2.3% Since Last Earnings Report: Can It Rebound?
Read MoreHide Full Article
It has been about a month since the last earnings report for Agco (AGCO - Free Report) . Shares have lost about 2.3% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Agco due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
AGCO Corp Q4 Earnings & Sales Top Estimates, Up Y/Y
AGCO Corporation delivered fourth-quarter 2021 adjusted EPS of $3.08 compared with the prior-year quarter’s $1.54 per share. The reported figure beat the Zacks Consensus Estimate of $1.72. The quarterly results reflect strong margin and sales performance across all segments.
Including one-time items, AGCO posted EPS of $3.75 compared with the year-ago quarter’s $1.78.
Revenues increased 16% year over year to $3,155 million during the December-end quarter. The top line surpassed the Zacks Consensus Estimate of $3,047 million. Excluding the favorable currency-translation impact of 3.2%, net sales were up 19.3% year over year.
Operational Update
Cost of sales increased 16.5% year over year to $2,473 million during the fourth quarter. Gross profit climbed 15% year over year to $683 million during the reported quarter. The gross margin came in at 22%, unchanged year over year.
Selling, general and administrative expenses came in at $285 million compared with the year-ago quarter’s $283 million. Adjusted income from operations was up 42% year over year to $272 million. Consequently, the operating margin came in at 8.6% compared with the year-earlier quarter’s 7%.
Segment Performance
Sales in the North America segment were up 39% year over year to $675 million during the October-December period. The segment reported an operating income of $23.7 million compared with the prior-year quarter’s $9.8 million.
Sales in the South America segment increased 52% year over year to $406 million. The segment reported an operating profit of $48.5 million compared with the prior-year quarter’s $15.9 million.
The EME (Europe/Middle East) segment’s sales came in at $1,797 million compared with the $1,723 million reported in the year-ago period. The EME’s operating income came in at $217 million compared with the year-ago quarter’s income of $205 million.
Sales in the Asia/Pacific segment were up 15% year on year to $278 million. The segment registered an operating profit of $38 million compared with the year-ago quarter’s $26 million.
Financial Update
AGCO Corporation reported cash and cash equivalents of $889 million at the end of 2021, down from $1,119 million at 2020-end. The company generated $683 million cash from operating activities in 2021 compared with $897 million in 2020.
2021 Performance
AGCO Corporation reported an adjusted EPS of $10.38 in 2021 compared with $5.61 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $9.03. Including one-time items, the bottom line came in at $11.85, up 109.7% from $5.65 reported in 2020.
Sales were up 22% year over year to $11.14 billion. The top line surpassed the Zacks Consensus Estimate of $11.03 billion.
Guidance
AGCO Corporation expects net sales for 2022 to be around $12.3 billion, suggesting improved sales volumes and pricing, partly offset by the negative impact from foreign currency translation. Gross and operating margins are expected to be higher than the 2021 levels, owing to higher sales and production volumes as well as the company’s pricing actions to mitigate cost inflation. The improved profitability is likely to support incremental investments in engineering and other technology to advance AGCO’s precision agriculture and digital initiatives. Considering these, management projects adjusted EPS for the current year to be at $11.50.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -6.5% due to these changes.
VGM Scores
At this time, Agco has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. 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, Agco has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Agco (AGCO) Down 2.3% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Agco (AGCO - Free Report) . Shares have lost about 2.3% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Agco due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
AGCO Corp Q4 Earnings & Sales Top Estimates, Up Y/Y
AGCO Corporation delivered fourth-quarter 2021 adjusted EPS of $3.08 compared with the prior-year quarter’s $1.54 per share. The reported figure beat the Zacks Consensus Estimate of $1.72. The quarterly results reflect strong margin and sales performance across all segments.
Including one-time items, AGCO posted EPS of $3.75 compared with the year-ago quarter’s $1.78.
Revenues increased 16% year over year to $3,155 million during the December-end quarter. The top line surpassed the Zacks Consensus Estimate of $3,047 million. Excluding the favorable currency-translation impact of 3.2%, net sales were up 19.3% year over year.
Operational Update
Cost of sales increased 16.5% year over year to $2,473 million during the fourth quarter. Gross profit climbed 15% year over year to $683 million during the reported quarter. The gross margin came in at 22%, unchanged year over year.
Selling, general and administrative expenses came in at $285 million compared with the year-ago quarter’s $283 million. Adjusted income from operations was up 42% year over year to $272 million. Consequently, the operating margin came in at 8.6% compared with the year-earlier quarter’s 7%.
Segment Performance
Sales in the North America segment were up 39% year over year to $675 million during the October-December period. The segment reported an operating income of $23.7 million compared with the prior-year quarter’s $9.8 million.
Sales in the South America segment increased 52% year over year to $406 million. The segment reported an operating profit of $48.5 million compared with the prior-year quarter’s $15.9 million.
The EME (Europe/Middle East) segment’s sales came in at $1,797 million compared with the $1,723 million reported in the year-ago period. The EME’s operating income came in at $217 million compared with the year-ago quarter’s income of $205 million.
Sales in the Asia/Pacific segment were up 15% year on year to $278 million. The segment registered an operating profit of $38 million compared with the year-ago quarter’s $26 million.
Financial Update
AGCO Corporation reported cash and cash equivalents of $889 million at the end of 2021, down from $1,119 million at 2020-end. The company generated $683 million cash from operating activities in 2021 compared with $897 million in 2020.
2021 Performance
AGCO Corporation reported an adjusted EPS of $10.38 in 2021 compared with $5.61 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $9.03. Including one-time items, the bottom line came in at $11.85, up 109.7% from $5.65 reported in 2020.
Sales were up 22% year over year to $11.14 billion. The top line surpassed the Zacks Consensus Estimate of $11.03 billion.
Guidance
AGCO Corporation expects net sales for 2022 to be around $12.3 billion, suggesting improved sales volumes and pricing, partly offset by the negative impact from foreign currency translation. Gross and operating margins are expected to be higher than the 2021 levels, owing to higher sales and production volumes as well as the company’s pricing actions to mitigate cost inflation. The improved profitability is likely to support incremental investments in engineering and other technology to advance AGCO’s precision agriculture and digital initiatives. Considering these, management projects adjusted EPS for the current year to be at $11.50.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -6.5% due to these changes.
VGM Scores
At this time, Agco has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. 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, Agco has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.