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FMC Tops Q3 Earnings & Sales Estimates, Lifts FY20 View

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FMC Corporation (FMC - Free Report) recorded earnings (as reported) of 85 cents per share in third-quarter 2020, up around 23% from 69 cents reported a year ago.  

Barring one-time items, adjusted earnings per share were $1.22, topping the Zacks Consensus Estimate of $1.11.

Revenues were $1,084.6 million for the quarter, up around 7% from the year-ago quarter. It also beat the Zacks Consensus Estimate of $1,082.5 million.

Revenues were driven by a 12% contribution from volume and a 3% contribution from pricing, partly offset by an 8% unfavorable impact of currencies. The company saw higher sales across all regions in the reported quarter. It benefited from strong demand in the quarter and its cost reduction actions.

FMC Corporation Price, Consensus and EPS Surprise

 

FMC Corporation Price, Consensus and EPS Surprise

FMC Corporation price-consensus-eps-surprise-chart | FMC Corporation Quote

Regional Sales Performance

Sales in Latin America rose 1% year over year in the reported quarter driven by volume gains and favorable pricing that offset currency headwinds.

Sales went up 8% year over year in North America on the back of strong herbicide and fungicide sales.

In EMEA (Europe, Middle East, and Africa), sales rose 10% year over year. Sales were boosted by strength in insecticides and cereal herbicides.

Revenues climbed 16% year over year in Asia as volume growth across India, Pakistan, Australia and Indonesia more than offset currency headwinds.

Financials

The company had cash and cash equivalents of $297.1 million at the end of the quarter, down 29% year over year. Long-term debt was $3,028.3 million, essentially flat year over year.

Guidance

The company raised its adjusted earnings per share guidance for 2020 to the range of $6.45-$6.57 from its prior view of $6.28-$6.62. The revised guidance reflects an increase of 7% at the midpoint compared with 2019 and also 6 cents higher than the earlier guidance. The company expects earnings to be driven by higher volumes in Latin America and Asia, global pricing and cost discipline.

For 2020, FMC sees revenues to be between $4.72 billion and $4.78 billion, indicating a rise of 3% at the midpoint versus 2019.

Moreover, FMC now envisions adjusted EBITDA of $1.295-$1.315 billion for 2020, compared with $1.265-$1.325 billion expected earlier. The guidance indicates a 7% rise at the midpoint versus 2019 and an increase of $10 million versus the earlier view.

For fourth-quarter 2020, revenues are projected in the band of $1.23-$1.29 billion, reflecting an increase of 5% at the midpoint compared with fourth-quarter 2019. Adjusted earnings are forecast in the range of $1.70-$1.82 per share, same as fourth-quarter 2019 at the midpoint.

Price Performance

FMC’s shares are up 7.1% year to date against the industry’s 6% decline.

 

 

Zacks Rank & Key Picks

FMC currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks worth considering in the basic materials space include Agnico Eagle Mines Limited (AEM - Free Report) , Barrick Gold Corporation (GOLD - Free Report) and B2Gold Corp. (BTG - Free Report) .

Agnico Eagle has a projected earnings growth rate of 100% for the current year. The company’s shares have gained around 36% in a year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Barrick Gold has an expected earnings growth rate of 100% for the current year. The company’s shares have surged around 63% in the past year. It currently carries a Zacks Rank #2 (Buy).

B2Gold has a projected earnings growth rate of 250% for the current year. The company’s shares have shot up roughly 90% in a year. It currently carries a Zacks Rank #2.

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