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Trimble (TRMB) Q4 Earnings Beat Estimates, Revenues Up Y/Y
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Trimble Inc. (TRMB - Free Report) delivered fourth-quarter 2018 non-GAAP earnings of 48 cents per share, surpassing the Zacks Consensus Estimate by 2 cents. The figure also increased 29.7% on a year-over-year basis but decreased 2% sequentially.
Per the company, non-GAAP revenues increased 13% year over year but declined 1.5% on a sequential basis to $792.9 million. Moreover, the company’s GAAP revenues came in $785.5 million, up 12% from the prior year quarter but down 1.2% from the previous quarter.
Well-performing segments drove year-over-year top-line growth in the reported quarter. Further, positive contributions from acquisitions of e-Builder and Viewpoint contributed well throughout the reported quarter.
Product revenues (60% of GAAP revenues) came in $471.4million, up 2.6% on a year-over-year basis. Services revenues (21.3% of revenues) came in $167.3 million, up 26.2% year over year. Subscription revenues (18.7% of revenues) increased 36.2% from the year-ago quarter to $146.8 million.
Coming to price performance, the shares of Trimble have lost 1.2% in a year, compared with the industry’s decline of 0.7%.
We note that the company’s acquisition strength remains a major positive and is likely to help the stock to rebound in the long haul.
Segments in Detail
Buildings and Infrastructure: This segment generated $287 million sales, accounting for 36.2% of the company’s non-GAAP revenues, growing 39.9% on a year-over-year basis. The company witnessed organic growth of 7% within this segment. Notably, strengthening BIM-centric building construction businesses drove year-over-year sales. Further, robust distribution network and expanding product portfolio are major positives.
Geospatial: Sales from this segment were $178.8 million, accounting for 22.6% of total revenues. The figure increased 2.2%, compared with the year-ago quarter. This can be attributed to strong end-user demand. Further, the segment witnessed organic growth of 3% in the reported quarter.
Resources and Utilities: The segment generated sales of $130.1 million, accounting for 16.4% of total revenues. The figure was down 1.7% on a year-over-year basis which was primarily owing to sluggish end-user business. This segment also remained flat organically. However, the company experienced strong performance of its OEM-based business.
Transportation: Sales from this segment went up 4.4% to $197 million, accounting for 24.8% of total revenues. Strong subscription revenues drove the sales within this segment. Further, this segment witnessed organic growth of 4% in the quarter under review.
In the fourth quarter, non-GAAP gross margin came in at 59.5%, expanding 420 basis points (bps) year over year. The increase can be attributed to favorable product mix and strong cost control strategies.
Adjusted operating expenses accounted for 37.8% of non-GAAP revenues, contracting 30 bps compared with the year-ago quarter.
Non-GAAP operating margin came in at 21.7%, expanding 460 bps year over year, driven by effective operating expense management across all the segments.
Balance Sheet & Cash Flow
As of Dec 31, 2018, cash and cash equivalents were $172.5 million, down from $205.4 million as of Sep 30, 2018. Inventories were $298 million, increasing from $286.3 million in the previous quarter.
Long-term debt was $1.71 billion at the end of fourth quarter, compared with $1.79 billion at the end of the third quarter.
Cash flow from operations was $102 million in the reported quarter, declining from $117 million in the last reported quarter.
Additionally, the company repurchased 1.1 million shares worth $40 million.
Guidance
For first-quarter 2018, Trimble expects non-GAAP earnings between 44 cents and 48 cents per share. The Zacks Consensus Estimate for earnings is pegged at 47 cents per share.
The company expects non-GAAP revenues between $795 million and $820 million. Further, GAAP revenues are anticipated to lie within the range of $792 million to $817 million. The Zacks Consensus Estimate for revenues is projected at $836.4 million.
Long-term earnings growth rate for TripAdvisor, Upland Software and RingCentral is currently pegged at 14.05%, 20% and 35%, respectively.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
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Trimble (TRMB) Q4 Earnings Beat Estimates, Revenues Up Y/Y
Trimble Inc. (TRMB - Free Report) delivered fourth-quarter 2018 non-GAAP earnings of 48 cents per share, surpassing the Zacks Consensus Estimate by 2 cents. The figure also increased 29.7% on a year-over-year basis but decreased 2% sequentially.
Per the company, non-GAAP revenues increased 13% year over year but declined 1.5% on a sequential basis to $792.9 million. Moreover, the company’s GAAP revenues came in $785.5 million, up 12% from the prior year quarter but down 1.2% from the previous quarter.
Well-performing segments drove year-over-year top-line growth in the reported quarter. Further, positive contributions from acquisitions of e-Builder and Viewpoint contributed well throughout the reported quarter.
Product revenues (60% of GAAP revenues) came in $471.4million, up 2.6% on a year-over-year basis. Services revenues (21.3% of revenues) came in $167.3 million, up 26.2% year over year. Subscription revenues (18.7% of revenues) increased 36.2% from the year-ago quarter to $146.8 million.
Coming to price performance, the shares of Trimble have lost 1.2% in a year, compared with the industry’s decline of 0.7%.
We note that the company’s acquisition strength remains a major positive and is likely to help the stock to rebound in the long haul.
Segments in Detail
Buildings and Infrastructure: This segment generated $287 million sales, accounting for 36.2% of the company’s non-GAAP revenues, growing 39.9% on a year-over-year basis. The company witnessed organic growth of 7% within this segment. Notably, strengthening BIM-centric building construction businesses drove year-over-year sales. Further, robust distribution network and expanding product portfolio are major positives.
Geospatial: Sales from this segment were $178.8 million, accounting for 22.6% of total revenues. The figure increased 2.2%, compared with the year-ago quarter. This can be attributed to strong end-user demand. Further, the segment witnessed organic growth of 3% in the reported quarter.
Resources and Utilities: The segment generated sales of $130.1 million, accounting for 16.4% of total revenues. The figure was down 1.7% on a year-over-year basis which was primarily owing to sluggish end-user business. This segment also remained flat organically. However, the company experienced strong performance of its OEM-based business.
Transportation: Sales from this segment went up 4.4% to $197 million, accounting for 24.8% of total revenues. Strong subscription revenues drove the sales within this segment. Further, this segment witnessed organic growth of 4% in the quarter under review.
Trimble Inc. Price, Consensus and EPS Surprise
Trimble Inc. Price, Consensus and EPS Surprise | Trimble Inc. Quote
Operating Details
In the fourth quarter, non-GAAP gross margin came in at 59.5%, expanding 420 basis points (bps) year over year. The increase can be attributed to favorable product mix and strong cost control strategies.
Adjusted operating expenses accounted for 37.8% of non-GAAP revenues, contracting 30 bps compared with the year-ago quarter.
Non-GAAP operating margin came in at 21.7%, expanding 460 bps year over year, driven by effective operating expense management across all the segments.
Balance Sheet & Cash Flow
As of Dec 31, 2018, cash and cash equivalents were $172.5 million, down from $205.4 million as of Sep 30, 2018. Inventories were $298 million, increasing from $286.3 million in the previous quarter.
Long-term debt was $1.71 billion at the end of fourth quarter, compared with $1.79 billion at the end of the third quarter.
Cash flow from operations was $102 million in the reported quarter, declining from $117 million in the last reported quarter.
Additionally, the company repurchased 1.1 million shares worth $40 million.
Guidance
For first-quarter 2018, Trimble expects non-GAAP earnings between 44 cents and 48 cents per share. The Zacks Consensus Estimate for earnings is pegged at 47 cents per share.
The company expects non-GAAP revenues between $795 million and $820 million. Further, GAAP revenues are anticipated to lie within the range of $792 million to $817 million. The Zacks Consensus Estimate for revenues is projected at $836.4 million.
Zacks Rank and Stocks to Consider
Trimble carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are TripAdvisor (TRIP - Free Report) , Upland Software (UPLD - Free Report) and RingCentral (RNG - Free Report) . While TripAdvisor sports a Zacks Rank #1 (Strong Buy), Upland Software and RingCentral carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for TripAdvisor, Upland Software and RingCentral is currently pegged at 14.05%, 20% and 35%, respectively.
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
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