A month has gone by since the last earnings report for Flir Systems (FLIR - Free Report) . Shares have lost about 6.1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Flir Systems due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
FLIR Systems Q2 Earnings Top Estimates, Revenues Match
FLIR Systems second-quarter 2020 adjusted earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 50 cents by 28%. Also, the reported figure increased 23.1% from 52 cents in the prior-year quarter.
The company reported GAAP earnings of 47 cents per share compared with 34 cents in the year-ago quarter.
FLIR Systems reported revenues of $482 million in the second quarter, almost in line with the prior-year quarter’s reported figure and the Zacks Consensus Estimate.
Segment-wise, quarterly revenues in the Industrial Technologies segment were $300.2 million, representing an increase of 5.5% from the prior-year quarter. The increase was primarily attributable to heightened demand for EST solutions as a result of the COVID-19 pandemic.
The Industrial Technologies segment’s operating income was $107.1 million compared with $71.6 million in the prior-year quarter.
Revenues in the Defense Technologies segment were $181.8 million, which decreased 7.9% from the prior-year quarter. The decrease was primarily attributable to the completion of certain contracts that contributed to revenues in the prior-year quarter.
The Defense Technologies segment’s operating income was $41.2 million compared with $45.8 million in the prior-year quarter.
The company’s total operating expenses declined 10.2% year over year to $152.4 million.
Consequently, adjusted operating income came in at $99.81 million compared with the operating income of $63.74 million in the second quarter of 2019.
Liquidity & Cash Flow
As of Jun 30, 2020, the company’s cash and cash equivalents were $333 million compared with $284.6 million as of Dec 31, 2019.
Long-term debt totaled $643.3 million, down from $648.4 million as of Dec 31, 2019.
Cash flow from operating activities for the six months ended Jun 30, 2020, amounted to $63.1 million, down 6.9% from $67.8 million in the first half of 2019.
FLIR Systems has withdrawn its previously-issued guidance for 2020 due to the uncertainties concerning the COVID-19 pandemic.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
Currently, Flir Systems has a nice Growth Score of B, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions has been net zero. Notably, Flir Systems has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.