Beacon Roofing Supply, Inc. (BECN - Free Report) reported lower-than-expected results in third-quarter fiscal 2019. The top and bottom lines declined from the prior-year period, thanks to persistent weather challenges.
Beacon Roofing reported adjusted earnings of 92 cents per share, missing the Zacks Consensus Estimate of $1.24 by 25.8%. The reported figure decreased 22% from $1.18 per share a year ago. Fiscal third-quarter results were impacted by weather challenges, primarily resulting from 25-30% more rain days than the prior year. This translates to an adverse impact of approximately $85 million on sales and 20 cents on adjusted EPS.
Sales & Operating Highlights
Net sales of $1.92 billion lagged the consensus mark of $1.99 billion by 3.4% and decreased 0.5% year over year. The decline was due to lower sales of non-residential roofing products (down 2.4%) and complementary products (declining 3.6%). This was partly offset by higher residential roofing product sales (up 2.9%).
Meanwhile, net sales from existing markets were down 1.1% from the year-ago period, mainly due to higher rainfall across the United States that impacted contractor installations.
Gross margin contracted 90 basis points (bps) to 24.6%.
Operating expenses increased 60 bps to 20.7% of total net sales during the quarter. Adjusted EBITDA declined 15.9% year over year to $157.8 million.
Cash Position
As of Jun 30, 2019, Beacon Roofing had cash and cash equivalents of $27.7 million, up from $27.6 million reported in the corresponding period of 2018. Cash used in operations was $194.9 million in the first nine months of fiscal 2019 versus $1 million in the comparable year-ago period.
Zacks Rank and Stocks to Consider
Beacon Roofing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Retail-Wholesale sector include Builders FirstSource, Inc. (BLDR - Free Report) , Williams-Sonoma, Inc. (WSM - Free Report) and RH (RH - Free Report) , each carrying a Zacks Rank #2 (Buy).
Builders FirstSource surpassed the Zacks Consensus Estimate in all the trailing four quarters, with an average positive earnings surprise of 26.6%.
Williams-Sonoma and RH have a three-five year expected EPS growth rate of 7.2% and 12.5%, respectively.
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Beacon Roofing Supply, Inc. (BECN - Free Report) reported lower-than-expected results in third-quarter fiscal 2019. The top and bottom lines declined from the prior-year period, thanks to persistent weather challenges.
Beacon Roofing reported adjusted earnings of 92 cents per share, missing the Zacks Consensus Estimate of $1.24 by 25.8%. The reported figure decreased 22% from $1.18 per share a year ago. Fiscal third-quarter results were impacted by weather challenges, primarily resulting from 25-30% more rain days than the prior year. This translates to an adverse impact of approximately $85 million on sales and 20 cents on adjusted EPS.
Sales & Operating Highlights
Net sales of $1.92 billion lagged the consensus mark of $1.99 billion by 3.4% and decreased 0.5% year over year. The decline was due to lower sales of non-residential roofing products (down 2.4%) and complementary products (declining 3.6%). This was partly offset by higher residential roofing product sales (up 2.9%).
Meanwhile, net sales from existing markets were down 1.1% from the year-ago period, mainly due to higher rainfall across the United States that impacted contractor installations.
Gross margin contracted 90 basis points (bps) to 24.6%.
Operating expenses increased 60 bps to 20.7% of total net sales during the quarter. Adjusted EBITDA declined 15.9% year over year to $157.8 million.
Cash Position
As of Jun 30, 2019, Beacon Roofing had cash and cash equivalents of $27.7 million, up from $27.6 million reported in the corresponding period of 2018. Cash used in operations was $194.9 million in the first nine months of fiscal 2019 versus $1 million in the comparable year-ago period.
Zacks Rank and Stocks to Consider
Beacon Roofing currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Zacks Retail-Wholesale sector include Builders FirstSource, Inc. (BLDR - Free Report) , Williams-Sonoma, Inc. (WSM - Free Report) and RH (RH - Free Report) , each carrying a Zacks Rank #2 (Buy).
Builders FirstSource surpassed the Zacks Consensus Estimate in all the trailing four quarters, with an average positive earnings surprise of 26.6%.
Williams-Sonoma and RH have a three-five year expected EPS growth rate of 7.2% and 12.5%, respectively.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
Click here to see these breakthrough stocks now >>
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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