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Valmont Industries, Inc. (VMI - Free Report) announced an accelerated share repurchase arrangement (ASR) with Citibank, N.A., to repurchase $120 million of its common stock. The ASR is under Valmont's earlier announced share repurchase program.
Valmont will make a $120 million prepayment to Citibank, N.A., under the terms of the ASR. VMI will initially receive around 0.4 million shares. The final number of shares will be determined based on the daily volume-weighted average share price over the length of the ASR, less an agreed-upon discount, and subject to revisions in line with the ASR agreement. The ASR is slated to close by the first quarter of 2024.
This ASR, paired with ongoing opportunistic repurchases in the open market, illustrates Valmont's belief in the business and its capacity to generate cash flows on a sustained basis. These initiatives are an effective way to enhance shareholder value by leveraging its strong balance sheet, VMI noted.
The company is committed to a balanced capital allocation plan that includes reinvesting in the business for development, including acquisitions, as well as returning cash to shareholders.
Shares of Valmont have lost 37.7% over the past year compared with a 10.9% decline of its industry.
Image Source: Zacks Investment Research
Valmont, on its third-quarter call, revised its 2023 guidance for net sales growth between -3% and -4% from its previous view of 0-2%. EPS (as reported) is expected to be $7.20 to $7.50 per share. Adjusted EPS is now forecast at $14.80 to $15.10. VMI anticipates capital expenditures in the $100-$110 million range for 2023. The company also expects a full-year improved operating margin compared with 2022 levels.
Better-ranked stocks in the basic materials space include Denison Mines Corp. (DNN - Free Report) , Axalta Coating Systems Ltd. (AXTA - Free Report) and The Andersons Inc. (ANDE - Free Report) .
Denison Mines has a projected earnings growth rate of 100% for the current year. It currently carries a Zacks Rank #1 (Strong Buy). DNN delivered a trailing four-quarter earnings surprise of roughly 225%, on average. The stock is up around 42.7% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axalta has a projected earnings growth rate of 5.4% for the current year. It currently carries a Zacks Rank #1. AXTA delivered a trailing four-quarter earnings surprise of roughly 6.7%, on average. The stock is up around 15.7% in a year.
Andersons currently carries a Zacks Rank #2 (Buy). The stock has gained roughly 28.2% in the past year. ANDE beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4%, on average.
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Valmont (VMI) Announces $120M Accelerated Share Buyback
Valmont Industries, Inc. (VMI - Free Report) announced an accelerated share repurchase arrangement (ASR) with Citibank, N.A., to repurchase $120 million of its common stock. The ASR is under Valmont's earlier announced share repurchase program.
Valmont will make a $120 million prepayment to Citibank, N.A., under the terms of the ASR. VMI will initially receive around 0.4 million shares. The final number of shares will be determined based on the daily volume-weighted average share price over the length of the ASR, less an agreed-upon discount, and subject to revisions in line with the ASR agreement. The ASR is slated to close by the first quarter of 2024.
This ASR, paired with ongoing opportunistic repurchases in the open market, illustrates Valmont's belief in the business and its capacity to generate cash flows on a sustained basis. These initiatives are an effective way to enhance shareholder value by leveraging its strong balance sheet, VMI noted.
The company is committed to a balanced capital allocation plan that includes reinvesting in the business for development, including acquisitions, as well as returning cash to shareholders.
Shares of Valmont have lost 37.7% over the past year compared with a 10.9% decline of its industry.
Image Source: Zacks Investment Research
Valmont, on its third-quarter call, revised its 2023 guidance for net sales growth between -3% and -4% from its previous view of 0-2%. EPS (as reported) is expected to be $7.20 to $7.50 per share. Adjusted EPS is now forecast at $14.80 to $15.10. VMI anticipates capital expenditures in the $100-$110 million range for 2023. The company also expects a full-year improved operating margin compared with 2022 levels.
Valmont Industries, Inc. Price and Consensus
Valmont Industries, Inc. price-consensus-chart | Valmont Industries, Inc. Quote
Zacks Rank & Key Picks
Valmont currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks in the basic materials space include Denison Mines Corp. (DNN - Free Report) , Axalta Coating Systems Ltd. (AXTA - Free Report) and The Andersons Inc. (ANDE - Free Report) .
Denison Mines has a projected earnings growth rate of 100% for the current year. It currently carries a Zacks Rank #1 (Strong Buy). DNN delivered a trailing four-quarter earnings surprise of roughly 225%, on average. The stock is up around 42.7% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Axalta has a projected earnings growth rate of 5.4% for the current year. It currently carries a Zacks Rank #1. AXTA delivered a trailing four-quarter earnings surprise of roughly 6.7%, on average. The stock is up around 15.7% in a year.
Andersons currently carries a Zacks Rank #2 (Buy). The stock has gained roughly 28.2% in the past year. ANDE beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4%, on average.