Machinery behemoth, The Middleby Corporation (MIDD - Free Report) , reported mixed second-quarter 2016 results. Though the company’s bottom line lagged the Zacks Consensus Estimate, the top line surpassed expectations.
The company’s quarterly earnings of $1.35 cents per share comfortably surpassed the Zacks Consensus Estimate of $1.09. Also, the bottom line improved from the year-ago tally by 39.2%.
On the other hand, Middleby’s net sales surged 33% year over year to $580.5 million. The year-over-year improvement was driven by organic sales growth of 5.1% and acquisition gains of 29.1%, partially offset by 1.1% negative impact from foreign currency translation. Moreover, the top line easily surpassed the Zacks Consensus Estimate of $561 million.
Segmental Details
Middleby reports its net sales under three heads/segments. The segmental results are briefly discussed below.
Revenues from the Commercial Foodservice Equipment Group totaled $321 million, up 11.1% year over year.
Revenues from the Food Processing Equipment Group grew 16.1% year over year to $83.5 million.
Revenues from the Residential Kitchen Equipment Group were $176 million, up 133.1% year over year.
Margins
In the quarter, Middleby’s cost of sales increased 31.7% year over year. This represents 59.8% of net sales compared with 60.4% in the year-ago quarter. Gross margin expanded 60 basis points (bps) year over year to 40.2%. Selling and distribution expenses, as a percentage of revenues, were 10%. General and administrative expenses were 9.8%.
While operating income surged 34.2% year over year, operating margin improved 20 basis points to 19.3%.
Balance Sheet
Middleby exited the second quarter with cash and cash equivalents of $74 million as against $55.5 million in the preceding quarter. Long-term debt decreased 17.5% sequentially to $862.6 million.
Stocks to Consider
Middleby currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the industry include Illinois Tool Works Inc. (ITW - Free Report) , Metso Corporation and Tennant Company (TNC - Free Report) . Both Illinois Tool Works and Metso Corporation hold a Zacks Rank #2 (Buy), while Tennant Company sports a Zacks Rank #1 (Strong Buy).
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Machinery behemoth, The Middleby Corporation (MIDD - Free Report) , reported mixed second-quarter 2016 results. Though the company’s bottom line lagged the Zacks Consensus Estimate, the top line surpassed expectations.
The company’s quarterly earnings of $1.35 cents per share comfortably surpassed the Zacks Consensus Estimate of $1.09. Also, the bottom line improved from the year-ago tally by 39.2%.
On the other hand, Middleby’s net sales surged 33% year over year to $580.5 million. The year-over-year improvement was driven by organic sales growth of 5.1% and acquisition gains of 29.1%, partially offset by 1.1% negative impact from foreign currency translation. Moreover, the top line easily surpassed the Zacks Consensus Estimate of $561 million.
Segmental Details
Middleby reports its net sales under three heads/segments. The segmental results are briefly discussed below.
Revenues from the Commercial Foodservice Equipment Group totaled $321 million, up 11.1% year over year.
Revenues from the Food Processing Equipment Group grew 16.1% year over year to $83.5 million.
Revenues from the Residential Kitchen Equipment Group were $176 million, up 133.1% year over year.
Margins
In the quarter, Middleby’s cost of sales increased 31.7% year over year. This represents 59.8% of net sales compared with 60.4% in the year-ago quarter. Gross margin expanded 60 basis points (bps) year over year to 40.2%. Selling and distribution expenses, as a percentage of revenues, were 10%. General and administrative expenses were 9.8%.
While operating income surged 34.2% year over year, operating margin improved 20 basis points to 19.3%.
Balance Sheet
Middleby exited the second quarter with cash and cash equivalents of $74 million as against $55.5 million in the preceding quarter. Long-term debt decreased 17.5% sequentially to $862.6 million.
Stocks to Consider
Middleby currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks in the industry include Illinois Tool Works Inc. (ITW - Free Report) , Metso Corporation and Tennant Company (TNC - Free Report) . Both Illinois Tool Works and Metso Corporation hold a Zacks Rank #2 (Buy), while Tennant Company sports a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
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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