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TriMas (TRS) Down 10.5% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for TriMas (TRS - Free Report) . Shares have lost about 10.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is TriMas due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
TriMas Q4 Earnings and Revenues Beat Estimates, Up Y/Y
TriMas reported fourth-quarter 2020 adjusted earnings of 38 cents per share, which beat the Zacks Consensus Estimate of 31 cents. The bottom line also improved 23% from the prior-year quarter. Although some end-markets remained challenged due to the impact of the coronavirus pandemic; strong sales in the Packaging group and contribution from recent acquisitions drove results in the quarter under review.
Including the impact of one-time items, the company reported earnings per share of 54 cents, against the year-ago quarter’s earnings of 30 cents per share.
The company’s revenues of $188 million surpassed the Zacks Consensus Estimate of $178 million. The top line also increased 10% year over year. This was driven by record sales in the Packaging segment and contribution from recent acquisitions. The Packaging segment has been benefiting from high demand for dispensing pumps and closure products sold into applications that help fight the spread of germs or are used in cleaning amid the pandemic. Higher sales of products utilized in food and beverage applications have also been contributing to the segment’s performance.
However, weak performance in the aerospace segment can be attributed to lower air travel, and reduced commercial and business jet production on account of the pandemic. Also, demand in industrial businesses remained weak amid the coronavirus crisis.
Costs & Margins
Cost of sales increased 12% year over year to $142 million in the reported quarter. Gross profit rose 5% year over year to $47 million. Gross margin was 24.7% compared with 25.9% in the prior-year quarter.
Selling, general and administrative expenses went up 19% year over year to $28 million. Adjusted operating profit dipped 0.5% year over year to $21 million. Adjusted operating margin contracted 120 basis points year over year to 11.2% in the reported quarter.
Segment Performance
Packaging: Net sales improved 32% year over year to $124 million. Adjusted operating profit surged 24% year over year to $24 million in the reported quarter.
Aerospace: Net sales slumped 24% year over year to $37 million from the prior-year quarter. The segment reported adjusted operating profit of $0.5 million that indicated a plunge of 94% year over year.
Specialty Products: The segment’s revenues declined 6% year over year to $27 million. Adjusted operating profit climbed 41% year over year to $3.5 million.
Financial Performance
TriMas ended 2020 with $312.3 million of unrestricted cash and aggregate availability. As of Dec 31, 2020, total debt was $346.3 million compared with $294.7 million as of Dec 31, 2019.
The company generated around $127 million of cash from operating activities in 2020 compared with $96 million in the prior year. TriMas resumed its share buyback program in third-quarter 2020. In 2020, the company utilized $193.5 million for acquisitions and repurchased shares worth $39.4 million. As of Dec 31, 2020, $161.7 million remained available under its repurchase authorization.
To strengthen its Packaging segment, TriMas acquired Affaba & Ferrari, a designer and manufacturer of engineered caps and closures for food and beverage, and industrial applications.
2020 Results
TriMas’ adjusted earnings per share in 2020 was $1.57, up 8% from the prior-year’s figure of $1.45. The bottom line beat the Zacks Consensus Estimate of $1.51. Including one-time items, the company reported loss per share of $1.83 in 2020 against an earnings per share of $1.36 in 2019. Sales increased 6% year over year to $770 million from the prior-year figure of $723 million. The top line surpassed the Zacks Consensus Estimate of $756 million.
Outlook
TriMas expects year-over-year sales growth in first-quarter 2021 in the range of 4% to 9%. Adjusted earnings per share is anticipated between 34 cents and 39 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
At this time, TriMas has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, TriMas has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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TriMas (TRS) Down 10.5% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for TriMas (TRS - Free Report) . Shares have lost about 10.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is TriMas due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
TriMas Q4 Earnings and Revenues Beat Estimates, Up Y/Y
TriMas reported fourth-quarter 2020 adjusted earnings of 38 cents per share, which beat the Zacks Consensus Estimate of 31 cents. The bottom line also improved 23% from the prior-year quarter. Although some end-markets remained challenged due to the impact of the coronavirus pandemic; strong sales in the Packaging group and contribution from recent acquisitions drove results in the quarter under review.
Including the impact of one-time items, the company reported earnings per share of 54 cents, against the year-ago quarter’s earnings of 30 cents per share.
The company’s revenues of $188 million surpassed the Zacks Consensus Estimate of $178 million. The top line also increased 10% year over year. This was driven by record sales in the Packaging segment and contribution from recent acquisitions. The Packaging segment has been benefiting from high demand for dispensing pumps and closure products sold into applications that help fight the spread of germs or are used in cleaning amid the pandemic. Higher sales of products utilized in food and beverage applications have also been contributing to the segment’s performance.
However, weak performance in the aerospace segment can be attributed to lower air travel, and reduced commercial and business jet production on account of the pandemic. Also, demand in industrial businesses remained weak amid the coronavirus crisis.
Costs & Margins
Cost of sales increased 12% year over year to $142 million in the reported quarter. Gross profit rose 5% year over year to $47 million. Gross margin was 24.7% compared with 25.9% in the prior-year quarter.
Selling, general and administrative expenses went up 19% year over year to $28 million. Adjusted operating profit dipped 0.5% year over year to $21 million. Adjusted operating margin contracted 120 basis points year over year to 11.2% in the reported quarter.
Segment Performance
Packaging: Net sales improved 32% year over year to $124 million. Adjusted operating profit surged 24% year over year to $24 million in the reported quarter.
Aerospace: Net sales slumped 24% year over year to $37 million from the prior-year quarter. The segment reported adjusted operating profit of $0.5 million that indicated a plunge of 94% year over year.
Specialty Products: The segment’s revenues declined 6% year over year to $27 million. Adjusted operating profit climbed 41% year over year to $3.5 million.
Financial Performance
TriMas ended 2020 with $312.3 million of unrestricted cash and aggregate availability. As of Dec 31, 2020, total debt was $346.3 million compared with $294.7 million as of Dec 31, 2019.
The company generated around $127 million of cash from operating activities in 2020 compared with $96 million in the prior year. TriMas resumed its share buyback program in third-quarter 2020. In 2020, the company utilized $193.5 million for acquisitions and repurchased shares worth $39.4 million. As of Dec 31, 2020, $161.7 million remained available under its repurchase authorization.
To strengthen its Packaging segment, TriMas acquired Affaba & Ferrari, a designer and manufacturer of engineered caps and closures for food and beverage, and industrial applications.
2020 Results
TriMas’ adjusted earnings per share in 2020 was $1.57, up 8% from the prior-year’s figure of $1.45. The bottom line beat the Zacks Consensus Estimate of $1.51. Including one-time items, the company reported loss per share of $1.83 in 2020 against an earnings per share of $1.36 in 2019. Sales increased 6% year over year to $770 million from the prior-year figure of $723 million. The top line surpassed the Zacks Consensus Estimate of $756 million.
Outlook
TriMas expects year-over-year sales growth in first-quarter 2021 in the range of 4% to 9%. Adjusted earnings per share is anticipated between 34 cents and 39 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
VGM Scores
At this time, TriMas has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, TriMas has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.