Silgan Holdings Inc. (SLGN - Free Report) reported adjusted earnings of $1.16 per share in third-quarter 2023, which surpassed the Zacks Consensus Estimate of adjusted earnings of $1.14 per share. The bottom line declined 9% year over year but came within the company’s guidance of $1.10-$1.20 per share.
Including one-time items, earnings were $1.02 per share compared with $1.25 per share reported in the prior-year quarter.
Total revenues decreased 8.5% year over year to $1,803 million from the prior-year quarter’s $1,970.4 million. The top line missed the Zacks Consensus Estimate of $1,957 million.
Costs and Margins
In third-quarter 2023, the cost of goods sold decreased 8.7% year over year to $1,517 million. The gross profit decreased 7.1% to $286 million. The gross margin was 15.9% compared with the prior-year quarter’s 15.6%.
Selling, general and administrative expenses were $84 million in the reported quarter compared with the year-ago quarter’s $97 million. The company reported an operating income of $194 million in the quarter compared with $219 million in the prior-year quarter.
Adjusted operating profit was $214 million in the third quarter of 2023, 4% lower than $223 million in the prior-year quarter. The adjusted operating margin was 11.9% in the reported quarter compared with the prior-year quarter’s 11.3%.
Segmental Performances
Revenues in the Dispensing and Specialty Closures segment were down 3% year over year to $559 million in the third quarter. The figure lagged the Zacks Consensus Estimate of $569 million due to a lower volume and mix. Due to the persistent impacts of inflation on consumers, mid-single-digit increases in higher-value dispensing products were offset by double-digit decreases in higher-volume closures for the international food and beverage markets.
The operating income for the segment was $78 million in the third quarter of 2023 compared with $79.2 million in third-quarter 2022. The figure lagged the Zacks Consensus Estimate of $99 million. The segment’s adjusted operating income was $93.8 million compared with $88.4 million in the prior-year period.
The Metal Containers segment’s revenues in the quarter declined 10% year over year to $1,095 million due to lower volumes. However, revenues in the quarter surpassed the Zacks Consensus Estimate of $764 million.
The segment’s operating income in the quarter under review was $110 million, down 9% from the prior-year quarter. However, the figure surpassed the consensus estimate of $44 million. Adjusted operating income for the segment amounted to $113.5 million, down 3% from the prior-year quarter.
In the Custom Containers segment, revenues were $149 million compared with the year-ago quarter’s $183 million. The figure was higher than the Zacks Consensus Estimate of $143 million. Operating income slumped 56% year over year to $10.7 million and missed the consensus estimate of $14 million. The segment reported an adjusted operating income of $11.8 million, down from the previous year’s $22.8 million.
2023 Outlook
Silgan expects 2023 adjusted earnings per share (EPS) between $3.30 and $3.40, declining from the previously mentioned $3.40-$3.60 due to expected lower volumes and higher interest expenses in the fourth quarter of 2023.
For fourth-quarter 2023, SLGN anticipates adjusted EPS in the range of 55-65 cents.
Price Performance
Silgan’s shares have lost 13.5% in the past year against the industry’s growth of 0.5%.
Zacks Rank and Stocks to Consider
Silgan currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the Industrial Products sector are Applied Industrial Technologies (AIT - Free Report) , Emerson Electric Co. (EMR - Free Report) and Brady (BRC - Free Report) . All these companies currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Applied Industrial has an average trailing four-quarter earnings surprise of 15%. The Zacks Consensus Estimate for AIT’s 2023 earnings is pegged at $9.13 per share, which indicates year-over-year growth of 2%. Estimates have moved up 2% in the past 60 days. The company’s shares gained 27% in the last year.
Emerson has an average trailing four-quarter earnings surprise of 7.4%. The Zacks Consensus Estimate for EMR’s 2023 earnings is pegged at $4.45 per share. The consensus estimate for 2023 earnings has moved 1% north in the past 60 days. EMR’s shares gained 5.9% in the last year.
The Zacks Consensus Estimate for Brady’s 2023 earnings per share is pegged at $3.62. The consensus estimate for 2023 earnings has moved 13% north in the past 60 days and suggests year-over-year growth of 9.9%. The company has a trailing four-quarter average earnings surprise of 7.2%. Shares of BRC rallied 17.7% in the last year.
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Silgan Holdings Inc. (SLGN - Free Report) reported adjusted earnings of $1.16 per share in third-quarter 2023, which surpassed the Zacks Consensus Estimate of adjusted earnings of $1.14 per share. The bottom line declined 9% year over year but came within the company’s guidance of $1.10-$1.20 per share.
Including one-time items, earnings were $1.02 per share compared with $1.25 per share reported in the prior-year quarter.
Total revenues decreased 8.5% year over year to $1,803 million from the prior-year quarter’s $1,970.4 million. The top line missed the Zacks Consensus Estimate of $1,957 million.
Costs and Margins
In third-quarter 2023, the cost of goods sold decreased 8.7% year over year to $1,517 million. The gross profit decreased 7.1% to $286 million. The gross margin was 15.9% compared with the prior-year quarter’s 15.6%.
Selling, general and administrative expenses were $84 million in the reported quarter compared with the year-ago quarter’s $97 million. The company reported an operating income of $194 million in the quarter compared with $219 million in the prior-year quarter.
Adjusted operating profit was $214 million in the third quarter of 2023, 4% lower than $223 million in the prior-year quarter. The adjusted operating margin was 11.9% in the reported quarter compared with the prior-year quarter’s 11.3%.
Segmental Performances
Revenues in the Dispensing and Specialty Closures segment were down 3% year over year to $559 million in the third quarter. The figure lagged the Zacks Consensus Estimate of $569 million due to a lower volume and mix. Due to the persistent impacts of inflation on consumers, mid-single-digit increases in higher-value dispensing products were offset by double-digit decreases in higher-volume closures for the international food and beverage markets.
The operating income for the segment was $78 million in the third quarter of 2023 compared with $79.2 million in third-quarter 2022. The figure lagged the Zacks Consensus Estimate of $99 million. The segment’s adjusted operating income was $93.8 million compared with $88.4 million in the prior-year period.
The Metal Containers segment’s revenues in the quarter declined 10% year over year to $1,095 million due to lower volumes. However, revenues in the quarter surpassed the Zacks Consensus Estimate of $764 million.
The segment’s operating income in the quarter under review was $110 million, down 9% from the prior-year quarter. However, the figure surpassed the consensus estimate of $44 million. Adjusted operating income for the segment amounted to $113.5 million, down 3% from the prior-year quarter.
In the Custom Containers segment, revenues were $149 million compared with the year-ago quarter’s $183 million. The figure was higher than the Zacks Consensus Estimate of $143 million. Operating income slumped 56% year over year to $10.7 million and missed the consensus estimate of $14 million. The segment reported an adjusted operating income of $11.8 million, down from the previous year’s $22.8 million.
2023 Outlook
Silgan expects 2023 adjusted earnings per share (EPS) between $3.30 and $3.40, declining from the previously mentioned $3.40-$3.60 due to expected lower volumes and higher interest expenses in the fourth quarter of 2023.
For fourth-quarter 2023, SLGN anticipates adjusted EPS in the range of 55-65 cents.
Price Performance
Silgan’s shares have lost 13.5% in the past year against the industry’s growth of 0.5%.
Zacks Rank and Stocks to Consider
Silgan currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the Industrial Products sector are Applied Industrial Technologies (AIT - Free Report) , Emerson Electric Co. (EMR - Free Report) and Brady (BRC - Free Report) . All these companies currently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Applied Industrial has an average trailing four-quarter earnings surprise of 15%. The Zacks Consensus Estimate for AIT’s 2023 earnings is pegged at $9.13 per share, which indicates year-over-year growth of 2%. Estimates have moved up 2% in the past 60 days. The company’s shares gained 27% in the last year.
Emerson has an average trailing four-quarter earnings surprise of 7.4%. The Zacks Consensus Estimate for EMR’s 2023 earnings is pegged at $4.45 per share. The consensus estimate for 2023 earnings has moved 1% north in the past 60 days. EMR’s shares gained 5.9% in the last year.
The Zacks Consensus Estimate for Brady’s 2023 earnings per share is pegged at $3.62. The consensus estimate for 2023 earnings has moved 13% north in the past 60 days and suggests year-over-year growth of 9.9%. The company has a trailing four-quarter average earnings surprise of 7.2%. Shares of BRC rallied 17.7% in the last year.
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
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