Astec Industries, Inc.’s (ASTE - Free Report) fourth-quarter 2020 adjusted earnings per share of 56 cents beat the Zacks Consensus Estimate of 42 cents by a margin of 33%. The bottom line also improved 56% from the prior-year quarter. The better-than-expected results were driven by the company’s transformation initiatives taken in 2019 and 2020, which offset the impact of lower revenues amid the coronavirus crisis.
Including one-time items, the company reported earnings per share of 67 cents in the quarter under review against a loss per share of 81 cents in the year-ago quarter.
Revenues & Backlog
Astec reported revenues of $239 million in the quarter, down 16% from the year-ago quarter’s figure of $283 million. However, the top line missed the Zacks Consensus Estimate of $273 million. Due to COVID-19-related disruptions, domestic and international sales declined 14% and 20%, respectively, on a year-over-year basis.
At fourth quarter-end, the company’s total backlog was $360.5 million, reflecting an improvement of 37% year over year. While domestic backlog surged 44% year over year to $280.6 million, international backlog increased 15% to $79.9 million.
Operating Performance
Adjusted cost of sales plunged 19% year over year to $182 million. Adjusted gross profit was $57 million, down 5% from the year-ago quarter figure of $60 million. Gross margin, however, expanded 260 basis points to 23.8% in the quarter under review compared with 21.2% in the year-ago quarter.
Selling, general, administrative and engineering (SG&A) declined 21.5% year over year to around $41 million, due to reductions in consulting fees, travel and employee expenses. Adjusted operating profit for the quarter under review was $15.7 million, which improved a substantial 109% from the prior-year quarter. Adjusted operating margin was 6.6% compared with 2.6% in the prior-year quarter, courtesy of operational efficiencies that helped offset the impact of lower sales.
Adjusted EBITDA was $23.3 million in the reported quarter, up 69% from the year-ago quarter. Adjusted EBITDA margin was 9.8%, a 500 basis point expansion from the prior-year quarter. Despite lower sales, the company’s restructuring initiatives benefited margins in the quarter.
Segment Performance
Revenues for the Infrastructure Solutions segment decreased 13% to $167 million from the year-ago quarter. The segment reported an adjusted gross profit of $39.5 million compared with $41 million in the prior-year quarter.
Materials Solutions segment’s total revenues slumped 22% year over year to $72 million. The segment reported an adjusted gross profit of $17.7 million, reflecting year-over-year increase of 2%.
Financial Position
Astec’s cash and cash equivalents significantly improved to $159 million as of Dec 31, 2020 from $49 million as of Dec 31, 2019. As of 2020-end, the company’s total debt was $2 million. It has available liquidity of more than $312.4 million as of Dec 31, 2020.
2020 Results
Astec’s adjusted earnings per share in 2020 was $2.38, a 54% improvement from the prior-year’s figure of $1.55. The bottom line beat the Zacks Consensus Estimate of $1.87. Including one-time items, the company delivered an earnings per share of $2.05 in 2020 compared with 98 cents in 2019. Sales declined 12% year over year to $1.02 billion and missed the Zacks Consensus Estimate of $1.06 billion.
Share Price Performance
Astec’s shares have gained 83% in the past year, compared with the industry‘s rally of 72.4%.
Zacks Rank & Stocks to Consider
Astec currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Industrial Products sector are Deere & Company (DE - Free Report) , AGCO Corporation (AGCO - Free Report) and Avery Dennison Corporation (AVY - Free Report) . While Deere flaunts a Zacks Rank #1 (Strong Buy), AGCO Corporation and Avery Dennison carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Deere & Company has a projected earnings growth rate of 38.8% for fiscal 2021. Over the past year, the company’s shares have appreciated 119% over the past year.
AGCO Corporation has an estimated earnings growth rate of 42.7% for the ongoing year. The company’s shares have gained 107% in the past year.
Avery Dennison has an expected earnings growth rate of 13.7% for 2021. Over the past year, the stock has climbed 49%.
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Astec Industries, Inc.’s (ASTE - Free Report) fourth-quarter 2020 adjusted earnings per share of 56 cents beat the Zacks Consensus Estimate of 42 cents by a margin of 33%. The bottom line also improved 56% from the prior-year quarter. The better-than-expected results were driven by the company’s transformation initiatives taken in 2019 and 2020, which offset the impact of lower revenues amid the coronavirus crisis.
Including one-time items, the company reported earnings per share of 67 cents in the quarter under review against a loss per share of 81 cents in the year-ago quarter.
Revenues & Backlog
Astec reported revenues of $239 million in the quarter, down 16% from the year-ago quarter’s figure of $283 million. However, the top line missed the Zacks Consensus Estimate of $273 million. Due to COVID-19-related disruptions, domestic and international sales declined 14% and 20%, respectively, on a year-over-year basis.
At fourth quarter-end, the company’s total backlog was $360.5 million, reflecting an improvement of 37% year over year. While domestic backlog surged 44% year over year to $280.6 million, international backlog increased 15% to $79.9 million.
Operating Performance
Adjusted cost of sales plunged 19% year over year to $182 million. Adjusted gross profit was $57 million, down 5% from the year-ago quarter figure of $60 million. Gross margin, however, expanded 260 basis points to 23.8% in the quarter under review compared with 21.2% in the year-ago quarter.
Selling, general, administrative and engineering (SG&A) declined 21.5% year over year to around $41 million, due to reductions in consulting fees, travel and employee expenses. Adjusted operating profit for the quarter under review was $15.7 million, which improved a substantial 109% from the prior-year quarter. Adjusted operating margin was 6.6% compared with 2.6% in the prior-year quarter, courtesy of operational efficiencies that helped offset the impact of lower sales.
Adjusted EBITDA was $23.3 million in the reported quarter, up 69% from the year-ago quarter. Adjusted EBITDA margin was 9.8%, a 500 basis point expansion from the prior-year quarter. Despite lower sales, the company’s restructuring initiatives benefited margins in the quarter.
Segment Performance
Revenues for the Infrastructure Solutions segment decreased 13% to $167 million from the year-ago quarter. The segment reported an adjusted gross profit of $39.5 million compared with $41 million in the prior-year quarter.
Materials Solutions segment’s total revenues slumped 22% year over year to $72 million. The segment reported an adjusted gross profit of $17.7 million, reflecting year-over-year increase of 2%.
Financial Position
Astec’s cash and cash equivalents significantly improved to $159 million as of Dec 31, 2020 from $49 million as of Dec 31, 2019. As of 2020-end, the company’s total debt was $2 million. It has available liquidity of more than $312.4 million as of Dec 31, 2020.
2020 Results
Astec’s adjusted earnings per share in 2020 was $2.38, a 54% improvement from the prior-year’s figure of $1.55. The bottom line beat the Zacks Consensus Estimate of $1.87. Including one-time items, the company delivered an earnings per share of $2.05 in 2020 compared with 98 cents in 2019. Sales declined 12% year over year to $1.02 billion and missed the Zacks Consensus Estimate of $1.06 billion.
Share Price Performance
Astec’s shares have gained 83% in the past year, compared with the industry‘s rally of 72.4%.
Zacks Rank & Stocks to Consider
Astec currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Industrial Products sector are Deere & Company (DE - Free Report) , AGCO Corporation (AGCO - Free Report) and Avery Dennison Corporation (AVY - Free Report) . While Deere flaunts a Zacks Rank #1 (Strong Buy), AGCO Corporation and Avery Dennison carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Deere & Company has a projected earnings growth rate of 38.8% for fiscal 2021. Over the past year, the company’s shares have appreciated 119% over the past year.
AGCO Corporation has an estimated earnings growth rate of 42.7% for the ongoing year. The company’s shares have gained 107% in the past year.
Avery Dennison has an expected earnings growth rate of 13.7% for 2021. Over the past year, the stock has climbed 49%.
Zacks Top 10 Stocks for 2021
In addition to the stocks discussed above, would you like to know about our 10 best buy-and-hold tickers for the entirety of 2021?
Last year's 2020 Zacks Top 10 Stocks portfolio returned gains as high as +386.8%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2021 today >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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