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AGCO Corp (AGCO) Earnings and Revenues Beat Estimates in Q4
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AGCO Corp. (AGCO - Free Report) delivered an adjusted EPS of $4.47 in fourth-quarter 2022 compared with the prior-year quarter’s $3.08 per share. The reported figure beat the Zacks Consensus Estimate of $3.88.
Including one-time items, AGCO posted an EPS of $4.29 compared with the year-ago quarter’s $3.75.
Revenues increased 23.6% year over year to a record $3,899 million in the December-end quarter. The top line surpassed the Zacks Consensus Estimate of $3,759 million. Excluding the unfavorable currency-translation impacts of 9.2%, net sales rose 32.7% year over year.
Operational Update
Cost of sales increased 19.6% year over year to $2,958 million in the fourth quarter. Gross profit increased 37.8% year over year to $941 million in the reported quarter. The gross margin was 24.1% compared with the prior-year quarter’s 21.6%.
Selling, general and administrative expenses were $325 million compared with the year-ago quarter’s $285 million. Adjusted income from operations rose 71.9% year over year to $468 million. The operating margin was 12% compared with the year-earlier quarter’s 8.6%.
AGCO Corporation Price, Consensus and EPS Surprise
Sales in the North America segment moved up 22.1% year over year to $824 million in the fourth quarter. The segment reported an operating income of $61 million compared with the prior-year quarter’s $24 million.
Sales in the South America segment increased 66.4% year over year to $675 million. The segment reported an operating profit of $135 million compared with the prior-year quarter’s $49 million.
The EME (Europe/Middle East) segment’s sales were $2,187 million compared with the $1,797 million reported in the year-ago period. The EME’s operating income was $319 million compared with the year-ago quarter’s $217 million.
Sales in the Asia/Pacific segment were down 23.1% year over year to $214 million. The segment registered an operating profit of $19 million compared with the year-ago quarter’s $38 million.
Financial Update
AGCO Corp reported cash and cash equivalents of $790 million at the end of 2022, down from $889 million at 2021-end. Net cash provided by operating activities totaled $838 in 2022 compared with $660 million in the prior-year period.
2022 Performance
The company delivered an adjusted EPS of $12.42 in 2022 compared with 2021’s $10.38 per share. The reported figure beat the Zacks Consensus Estimate of $11.84.
Including one-time items, AGCO posted an EPS of $11.87 compared with the year-ago quarter’s $11.85.
Revenues increased 13.6% year over year to a record $12.7 billion in 2022. The top line surpassed the Zacks Consensus Estimate of $12.5 billion. Excluding the unfavorable currency-translation impacts of 8.5%, net sales rose 22.1% year over year.
Guidance
AGCO Corp expects 2023 net sales of $14 billion. The company expects improved sales volumes and positive pricing to impact 2023’s results. These tailwinds will be partially offset by negative foreign currency translation.
Gross and operating margins are expected to be higher than the 2022 reported levels, owing to higher sales and production volumes, as well as the company’s pricing actions to mitigate material and labor 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 EPS of $13.50 for 2023.
Price Performance
AGCO Corp’s shares have gained 2.8% in the past year compared with the industry’s growth of 2.9%.
Image Source: Zacks Investment Research
Zacks Rank and Other Stocks to Consider
AGCO Corp currently carries a Zacks Rank #2 (Buy).
O-I Glass has an average trailing four-quarter earnings surprise of 14.9%. The Zacks Consensus Estimate for OI’s 2022 earnings is pegged at $2.51 per share. This indicates a 15.7% increase from the prior-year reported figure. The consensus estimate for 2022 earnings has been unchanged in the past 60 days. OI’s shares gained 66.9% in the last year.
Tenaris has an average trailing four-quarter earnings surprise of 20.9%. The Zacks Consensus Estimate for TS’ 2022 earnings is pegged at $4.38 per share. This indicates a 134.2% increase from the prior-year reported figure. The consensus estimate for 2022 earnings has moved north by 2.1% in the past 60 days. Its shares gained 36.9% in the last year.
The Zacks Consensus Estimate for Deere & Company’s fiscal 2023 earnings per share is pegged at $28.01, suggesting an increase of 19.6% from that reported in the last year. The consensus estimate for fiscal 2023 earnings has moved 2.7% upward in the last 60 days. DE has a trailing four-quarter average earnings surprise of 7.1%. Its shares gained 11.7% in the last year.
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AGCO Corp (AGCO) Earnings and Revenues Beat Estimates in Q4
AGCO Corp. (AGCO - Free Report) delivered an adjusted EPS of $4.47 in fourth-quarter 2022 compared with the prior-year quarter’s $3.08 per share. The reported figure beat the Zacks Consensus Estimate of $3.88.
Including one-time items, AGCO posted an EPS of $4.29 compared with the year-ago quarter’s $3.75.
Revenues increased 23.6% year over year to a record $3,899 million in the December-end quarter. The top line surpassed the Zacks Consensus Estimate of $3,759 million. Excluding the unfavorable currency-translation impacts of 9.2%, net sales rose 32.7% year over year.
Operational Update
Cost of sales increased 19.6% year over year to $2,958 million in the fourth quarter. Gross profit increased 37.8% year over year to $941 million in the reported quarter. The gross margin was 24.1% compared with the prior-year quarter’s 21.6%.
Selling, general and administrative expenses were $325 million compared with the year-ago quarter’s $285 million. Adjusted income from operations rose 71.9% year over year to $468 million. The operating margin was 12% compared with the year-earlier quarter’s 8.6%.
AGCO Corporation Price, Consensus and EPS Surprise
AGCO Corporation price-consensus-eps-surprise-chart | AGCO Corporation Quote
Segmental Performance
Sales in the North America segment moved up 22.1% year over year to $824 million in the fourth quarter. The segment reported an operating income of $61 million compared with the prior-year quarter’s $24 million.
Sales in the South America segment increased 66.4% year over year to $675 million. The segment reported an operating profit of $135 million compared with the prior-year quarter’s $49 million.
The EME (Europe/Middle East) segment’s sales were $2,187 million compared with the $1,797 million reported in the year-ago period. The EME’s operating income was $319 million compared with the year-ago quarter’s $217 million.
Sales in the Asia/Pacific segment were down 23.1% year over year to $214 million. The segment registered an operating profit of $19 million compared with the year-ago quarter’s $38 million.
Financial Update
AGCO Corp reported cash and cash equivalents of $790 million at the end of 2022, down from $889 million at 2021-end. Net cash provided by operating activities totaled $838 in 2022 compared with $660 million in the prior-year period.
2022 Performance
The company delivered an adjusted EPS of $12.42 in 2022 compared with 2021’s $10.38 per share. The reported figure beat the Zacks Consensus Estimate of $11.84.
Including one-time items, AGCO posted an EPS of $11.87 compared with the year-ago quarter’s $11.85.
Revenues increased 13.6% year over year to a record $12.7 billion in 2022. The top line surpassed the Zacks Consensus Estimate of $12.5 billion. Excluding the unfavorable currency-translation impacts of 8.5%, net sales rose 22.1% year over year.
Guidance
AGCO Corp expects 2023 net sales of $14 billion. The company expects improved sales volumes and positive pricing to impact 2023’s results. These tailwinds will be partially offset by negative foreign currency translation.
Gross and operating margins are expected to be higher than the 2022 reported levels, owing to higher sales and production volumes, as well as the company’s pricing actions to mitigate material and labor 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 EPS of $13.50 for 2023.
Price Performance
AGCO Corp’s shares have gained 2.8% in the past year compared with the industry’s growth of 2.9%.
Image Source: Zacks Investment Research
Zacks Rank and Other Stocks to Consider
AGCO Corp currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the Industrial Products sector are O-I Glass, Inc (OI - Free Report) , Tenaris (TS - Free Report) and Deere & Company (DE - Free Report) . OI and TS flaunt a Zacks Rank #1 (Strong Buy) at present, and DE has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
O-I Glass has an average trailing four-quarter earnings surprise of 14.9%. The Zacks Consensus Estimate for OI’s 2022 earnings is pegged at $2.51 per share. This indicates a 15.7% increase from the prior-year reported figure. The consensus estimate for 2022 earnings has been unchanged in the past 60 days. OI’s shares gained 66.9% in the last year.
Tenaris has an average trailing four-quarter earnings surprise of 20.9%. The Zacks Consensus Estimate for TS’ 2022 earnings is pegged at $4.38 per share. This indicates a 134.2% increase from the prior-year reported figure. The consensus estimate for 2022 earnings has moved north by 2.1% in the past 60 days. Its shares gained 36.9% in the last year.
The Zacks Consensus Estimate for Deere & Company’s fiscal 2023 earnings per share is pegged at $28.01, suggesting an increase of 19.6% from that reported in the last year. The consensus estimate for fiscal 2023 earnings has moved 2.7% upward in the last 60 days. DE has a trailing four-quarter average earnings surprise of 7.1%. Its shares gained 11.7% in the last year.