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Machinery company The Gorman-Rupp Company (GRC - Free Report) delivered a positive earnings surprise of 32% for third-quarter 2017. The company’s shares reached a high of $33.50 during its trading session on Oct 27, following the release, representing 2.6% rally over the day’s opening price.
Earnings, before special items, came in at 33 cents per share, surpassing the Zacks Consensus Estimate of 25 cents. Also, the figure improved 37.5% from the year-ago tally of 24 cents.
Non-Water Markets Drive Revenues, Backlog Solid
Gorman-Rupp’s net sales in the quarter totaled $94 million, increasing 2.9% year over year. However, the top line grew roughly 4.4% after excluding the sales of the New Orleans Permanent Canal Closures & Pumps (PCCP) project.
Excluding the PCCP project, the company’s domestic sales grew 3.5% while international sales increased 6%.
Considering the sources, the company’s sales (excluding PCCP project) in larger water markets decreased 2.2% year over year while in non-water markets it increased 21.7%.
Exiting the quarter, the company’s backlog of orders were $111.4 million, up 8.4% from the year-ago quarter. Incoming orders in the quarter grew 17% year over year.
Margin Improves
The company’s margin profile improved in the quarter. Cost of goods sold dipped 1.3% year over year while as a percentage of revenues it came in at 72.1% versus 75.2% in the prior-year quarter. Gross margin increased 310 basis points (bps) to 27.9%.
Selling, general and administrative expenses, as a percentage of revenues were 15.2% compared with 14% in the year-ago quarter.
Cash Balance & Dividend Hike
Exiting the third quarter, Gorman-Rupp had cash and cash equivalents of $76 million, down from $63.7 million recorded at second-quarter end.
Concurrent with the earnings release, the company announced that its board of directors has approved an 8.7% increase in its quarterly dividend rate. The new quarterly cash dividend of 12.5 cents per share will be paid on Dec 8, to shareholders of record as on Nov 15.
Outlook
In the quarters ahead, Gorman-Rupp anticipates gaining from healthy incoming order rates and overall improving business conditions.
With a market capitalization of $808 million, Gorman-Rupp Company currently sports a Zacks Rank #1 (Strong Buy). Other stocks worth considering in the industry include Sun Hydraulics Corporation , Barnes Group Inc. (B - Free Report) and Graco Inc. (GGG - Free Report) . While Sun Hydraulics sports a Zacks Rank #1, both Barnes and Graco carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sun Hydraulics’ financial performance was impressive, with an average positive earnings surprise of 3.47% over the last four quarters. Also, earnings estimates for 2017 and 2018 were revised upward over the last 60 days.
Barnes Group pulled off an average positive earnings surprise of 9.02% over the last four quarters. Also, its earnings estimates for 2017 and 2018 were revised upward over the last 60 days.
Graco delivered an average positive earnings surprise of 24.34% over the last four quarters. Also, earnings estimates for 2017 and 2018 improved over the past 60 days.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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Gorman-Rupp (GRC) Tops Q3 Earnings, Hikes Quarterly Dividend
Machinery company The Gorman-Rupp Company (GRC - Free Report) delivered a positive earnings surprise of 32% for third-quarter 2017. The company’s shares reached a high of $33.50 during its trading session on Oct 27, following the release, representing 2.6% rally over the day’s opening price.
Earnings, before special items, came in at 33 cents per share, surpassing the Zacks Consensus Estimate of 25 cents. Also, the figure improved 37.5% from the year-ago tally of 24 cents.
Non-Water Markets Drive Revenues, Backlog Solid
Gorman-Rupp’s net sales in the quarter totaled $94 million, increasing 2.9% year over year. However, the top line grew roughly 4.4% after excluding the sales of the New Orleans Permanent Canal Closures & Pumps (PCCP) project.
Excluding the PCCP project, the company’s domestic sales grew 3.5% while international sales increased 6%.
Considering the sources, the company’s sales (excluding PCCP project) in larger water markets decreased 2.2% year over year while in non-water markets it increased 21.7%.
Exiting the quarter, the company’s backlog of orders were $111.4 million, up 8.4% from the year-ago quarter. Incoming orders in the quarter grew 17% year over year.
Margin Improves
The company’s margin profile improved in the quarter. Cost of goods sold dipped 1.3% year over year while as a percentage of revenues it came in at 72.1% versus 75.2% in the prior-year quarter. Gross margin increased 310 basis points (bps) to 27.9%.
Selling, general and administrative expenses, as a percentage of revenues were 15.2% compared with 14% in the year-ago quarter.
Cash Balance & Dividend Hike
Exiting the third quarter, Gorman-Rupp had cash and cash equivalents of $76 million, down from $63.7 million recorded at second-quarter end.
Concurrent with the earnings release, the company announced that its board of directors has approved an 8.7% increase in its quarterly dividend rate. The new quarterly cash dividend of 12.5 cents per share will be paid on Dec 8, to shareholders of record as on Nov 15.
Outlook
In the quarters ahead, Gorman-Rupp anticipates gaining from healthy incoming order rates and overall improving business conditions.
Gorman-Rupp Company (The) Price and Consensus
Gorman-Rupp Company (The) Price and Consensus | Gorman-Rupp Company (The) Quote
Zacks Rank & Other Stocks to Consider
With a market capitalization of $808 million, Gorman-Rupp Company currently sports a Zacks Rank #1 (Strong Buy). Other stocks worth considering in the industry include Sun Hydraulics Corporation , Barnes Group Inc. (B - Free Report) and Graco Inc. (GGG - Free Report) . While Sun Hydraulics sports a Zacks Rank #1, both Barnes and Graco carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sun Hydraulics’ financial performance was impressive, with an average positive earnings surprise of 3.47% over the last four quarters. Also, earnings estimates for 2017 and 2018 were revised upward over the last 60 days.
Barnes Group pulled off an average positive earnings surprise of 9.02% over the last four quarters. Also, its earnings estimates for 2017 and 2018 were revised upward over the last 60 days.
Graco delivered an average positive earnings surprise of 24.34% over the last four quarters. Also, earnings estimates for 2017 and 2018 improved over the past 60 days.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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