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Johnson Controls (JCI) Beats on Q4 Earnings and Revenues
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Johnson Controls International plc (JCI - Free Report) posted adjusted earnings of $1.21 per share in fourth-quarter (ended Sep 30, 2016) fiscal 2016 that surpassed the Zacks Consensus Estimate of $1.02. Moreover, earnings per share increased 16% from $1.04 earned in the fourth quarter of fiscal 2015.
Operational Update
Johnson Controls reported revenues of $10.2 billion, up 16.6% year over year. Revenues also surpassed the Zacks Consensus Estimate of $10.06 billion. The improvement was backed by incremental sales from the Johnson Controls-Hitachi joint venture.
Cost of sales increased to $8.1 billion from $7.2 billion in the year-ago period. Gross profit rose to $2.1 billion from $1.6 billion a year ago.
Selling, general and administrative expenses in the fourth quarter totaled $1.91 billion, up from the prior-year quarter figure of $1.03 billion. The company reported business segment income of $798 million, down from $1.05 billion recorded a year ago.
Johnson Controls reported a 16% year-over-year increase in adjusted earnings to $3.98 per share for fiscal 2016. The figure also surpassed the Zacks Consensus Estimate of $3.92.
Revenues for fiscal 2016 increased to $37.67 billion from $37.18 billion in fiscal 2015, marginally missing the Zacks Consensus Estimate of $37.69 billion.
Segment Results
Automotive Experience: Revenues in this segment fell 5% year over year to $3.9 billion, mainly due to declines in Europe and the Americas.
Segment income rose 13% to $281 million, aided by cost-reduction initiatives, restructuring savings and operational efficiencies.
Building Efficiency: In this segment, revenues came in at $3.6 billion, up 25% from the year-ago level. Excluding incremental revenue associated with M&A and foreign currency impact, revenues improved 2%, backed by better results in North America and Asia.
The quarter-end backlog increased 5% year over year. Orders, excluding M&A and adjusted for foreign exchange, were up 6% year over year, led by an increase in orders in North America and Asia.
Segment income climbed 17% to $410 million in the reported quarter from $351 million in the prior-year quarter.
Power Solutions: Revenues in the Power Solutions segment improved 7% to $1.8 billion. Excluding the impact of foreign exchange and lower lead pass-through costs, revenues increased 8%. Segment income was $394 million, up 16% from the year-ago period due to higher volumes, mix, and cost reduction initiatives.
Financial Position
Johnson Controls had cash and cash equivalents of $684 million as of Sep 30, 2016, indicating an increase from $597 million as of Sep 30, 2015. Total debt rose to $16.4 billion as of Sep 30, 2016, from $6.6 billion as of Sep 30, 2015.
In fiscal 2016, Johnson Controls’ operating cash flow was $1.9 billion compared with $1.6 billion in the year-ago period. Meanwhile, capital expenditures increased to $1.2 billion from $1.1 billion in the prior-year period.
Share Repurchases
Johnson Controls repurchased $501 million worth of shares in fiscal 2016.
Zacks Rank
Johnson Controls is a supplier of automotive interiors, batteries and other control equipment. It currently carries a Zacks Rank #5 (Strong Sell). Some better-ranked auto stocks include America's Car-Mart Inc. (CRMT - Free Report) , Gentex Corp. (GNTX - Free Report) and Rush Enterprises, Inc. (RUSHA - Free Report) .
Rush Enterprises, carrying a Zacks Rank #2 (Buy), has a long-term expected growth rate of 15%, compared to the industry average of 13.20%.
Gentex, also a Zacks Rank #2 stock, has a long-term expected growth rate of 11.20%.
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Johnson Controls (JCI) Beats on Q4 Earnings and Revenues
Johnson Controls International plc (JCI - Free Report) posted adjusted earnings of $1.21 per share in fourth-quarter (ended Sep 30, 2016) fiscal 2016 that surpassed the Zacks Consensus Estimate of $1.02. Moreover, earnings per share increased 16% from $1.04 earned in the fourth quarter of fiscal 2015.
Operational Update
Johnson Controls reported revenues of $10.2 billion, up 16.6% year over year. Revenues also surpassed the Zacks Consensus Estimate of $10.06 billion. The improvement was backed by incremental sales from the Johnson Controls-Hitachi joint venture.
Cost of sales increased to $8.1 billion from $7.2 billion in the year-ago period. Gross profit rose to $2.1 billion from $1.6 billion a year ago.
Selling, general and administrative expenses in the fourth quarter totaled $1.91 billion, up from the prior-year quarter figure of $1.03 billion. The company reported business segment income of $798 million, down from $1.05 billion recorded a year ago.
JOHNSON CONTRLS Price, Consensus and EPS Surprise
JOHNSON CONTRLS Price, Consensus and EPS Surprise | JOHNSON CONTRLS Quote
Fiscal 2016 Performance
Johnson Controls reported a 16% year-over-year increase in adjusted earnings to $3.98 per share for fiscal 2016. The figure also surpassed the Zacks Consensus Estimate of $3.92.
Revenues for fiscal 2016 increased to $37.67 billion from $37.18 billion in fiscal 2015, marginally missing the Zacks Consensus Estimate of $37.69 billion.
Segment Results
Automotive Experience: Revenues in this segment fell 5% year over year to $3.9 billion, mainly due to declines in Europe and the Americas.
Segment income rose 13% to $281 million, aided by cost-reduction initiatives, restructuring savings and operational efficiencies.
Building Efficiency: In this segment, revenues came in at $3.6 billion, up 25% from the year-ago level. Excluding incremental revenue associated with M&A and foreign currency impact, revenues improved 2%, backed by better results in North America and Asia.
The quarter-end backlog increased 5% year over year. Orders, excluding M&A and adjusted for foreign exchange, were up 6% year over year, led by an increase in orders in North America and Asia.
Segment income climbed 17% to $410 million in the reported quarter from $351 million in the prior-year quarter.
Power Solutions: Revenues in the Power Solutions segment improved 7% to $1.8 billion. Excluding the impact of foreign exchange and lower lead pass-through costs, revenues increased 8%. Segment income was $394 million, up 16% from the year-ago period due to higher volumes, mix, and cost reduction initiatives.
Financial Position
Johnson Controls had cash and cash equivalents of $684 million as of Sep 30, 2016, indicating an increase from $597 million as of Sep 30, 2015. Total debt rose to $16.4 billion as of Sep 30, 2016, from $6.6 billion as of Sep 30, 2015.
In fiscal 2016, Johnson Controls’ operating cash flow was $1.9 billion compared with $1.6 billion in the year-ago period. Meanwhile, capital expenditures increased to $1.2 billion from $1.1 billion in the prior-year period.
Share Repurchases
Johnson Controls repurchased $501 million worth of shares in fiscal 2016.
Zacks Rank
Johnson Controls is a supplier of automotive interiors, batteries and other control equipment. It currently carries a Zacks Rank #5 (Strong Sell). Some better-ranked auto stocks include America's Car-Mart Inc. (CRMT - Free Report) , Gentex Corp. (GNTX - Free Report) and Rush Enterprises, Inc. (RUSHA - Free Report) .
America's Car-Mart has witnessed positive estimate revisions over the last 30 days. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Rush Enterprises, carrying a Zacks Rank #2 (Buy), has a long-term expected growth rate of 15%, compared to the industry average of 13.20%.
Gentex, also a Zacks Rank #2 stock, has a long-term expected growth rate of 11.20%.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>