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The Manitowoc Company, Inc. (MTW) Down 5.2% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for The Manitowoc Company, Inc. (MTW - Free Report) . Shares have lost about 5.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is The Manitowoc Company, Inc. 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 drivers.
Manitowoc Q3 Earnings and Revenues Miss Estimates
Manitowoc reported third-quarter 2021 earnings of 6 cents, which missed the Zacks Consensus Estimate of 10 cents by margin of 40%. The bottom line declined 40% from the year-ago quarter’s earnings of 10 cents per share. The company witnessed strong order rates and continued positive customer sentiment through the quarter. However, cost inflation and parts shortages impaired the company’s ability to achieve its shipments.
Including one-time items, the company reported a loss per share of 1 cent in the quarter, flat compared with the prior-year quarter.
Manitowoc’s revenues climbed 14% to $405 million from the prior-year quarter figure of $355 million. However, the top line lagged the Zacks Consensus Estimate of $463 million.
Orders in the reported quarter increased 37% year over year to $535 million. Backlog as of the end of the reported quarter was $890.6 million, up 92% from the year-ago quarter’s end.
Operational Update
Cost of sales increased 15% year over year to $335 million in the reported quarter. Gross profit improved 6% year over year to $69 million. Gross margin was 17.1% in the reported quarter compared with 18.3% in the prior-year quarter.
Engineering, selling and administrative expenses increased 21% year over year to $59.7 million. Adjusted operating income was $9.7 million in the quarter, which declined 38% from $15.6 million in the prior-year quarter. Adjusted EBITDA in the reported quarter was $20 million, down 19% from $24.8 million in third-quarter 2020 on higher material and transportation costs, and lower plant productivity. Adjusted EBITDA margin contracted 210 basis points year over year to 4.9% in the quarter under review.
Financial Updates
Manitowoc reported cash and cash equivalents of $222 million as of Sep 30, 2021, up from $128.7 million as of Dec 31, 2020. Long-term debt was $400 million as of Sep 30, 2021, up from $300 million as of Dec 31, 2020. The company generated $68 million of cash in operating activities in first nine-month period of 2021 compared with cash utilization of $70.9 million in the prior-year comparable period.
On Oct 1, 2021, Manitowoc completed the acquisition of the crane business of H&E Equipment Services, Inc., one of the largest rental equipment companies in the United States, for $130 million. The acquisition expands Manitowoc’s ability to provide rentals, new sales, used sales, aftermarket parts, and service to a variety of end market customers. This is in sync with the company’s intention to grow via four strategic priorities, one of which is focused on buyouts to grow its aftermarket business. Earlier in September, Manitowoc completed the acquisition of all the assets of Aspen Equipment Company, a diversified crane dealer and a leading final-stage, purpose-built work truck upfitter, for approximately $51 million.
Outlook
Manitowoc has been witnessing positive trends in crane demand. It anticipates rising inflation, supply chain shortages, and skilled labor constraints to impact results in the remaining part of the year and in 2022 as well.
Manitowoc expects revenues in the range of $1.725 to $1.775 billion, down from the prior expectation of $1.775 to $1.825 billion in 2021. Adjusted EBITDA is now anticipated between $100 million and $110 million, compared with the prior guidance of $105-$115 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -60.42% due to these changes.
VGM Scores
Currently, The Manitowoc Company, Inc. has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, The Manitowoc Company, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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The Manitowoc Company, Inc. (MTW) Down 5.2% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for The Manitowoc Company, Inc. (MTW - Free Report) . Shares have lost about 5.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is The Manitowoc Company, Inc. 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 drivers.
Manitowoc Q3 Earnings and Revenues Miss Estimates
Manitowoc reported third-quarter 2021 earnings of 6 cents, which missed the Zacks Consensus Estimate of 10 cents by margin of 40%. The bottom line declined 40% from the year-ago quarter’s earnings of 10 cents per share. The company witnessed strong order rates and continued positive customer sentiment through the quarter. However, cost inflation and parts shortages impaired the company’s ability to achieve its shipments.
Including one-time items, the company reported a loss per share of 1 cent in the quarter, flat compared with the prior-year quarter.
Manitowoc’s revenues climbed 14% to $405 million from the prior-year quarter figure of $355 million. However, the top line lagged the Zacks Consensus Estimate of $463 million.
Orders in the reported quarter increased 37% year over year to $535 million. Backlog as of the end of the reported quarter was $890.6 million, up 92% from the year-ago quarter’s end.
Operational Update
Cost of sales increased 15% year over year to $335 million in the reported quarter. Gross profit improved 6% year over year to $69 million. Gross margin was 17.1% in the reported quarter compared with 18.3% in the prior-year quarter.
Engineering, selling and administrative expenses increased 21% year over year to $59.7 million. Adjusted operating income was $9.7 million in the quarter, which declined 38% from $15.6 million in the prior-year quarter. Adjusted EBITDA in the reported quarter was $20 million, down 19% from $24.8 million in third-quarter 2020 on higher material and transportation costs, and lower plant productivity. Adjusted EBITDA margin contracted 210 basis points year over year to 4.9% in the quarter under review.
Financial Updates
Manitowoc reported cash and cash equivalents of $222 million as of Sep 30, 2021, up from $128.7 million as of Dec 31, 2020. Long-term debt was $400 million as of Sep 30, 2021, up from $300 million as of Dec 31, 2020. The company generated $68 million of cash in operating activities in first nine-month period of 2021 compared with cash utilization of $70.9 million in the prior-year comparable period.
On Oct 1, 2021, Manitowoc completed the acquisition of the crane business of H&E Equipment Services, Inc., one of the largest rental equipment companies in the United States, for $130 million. The acquisition expands Manitowoc’s ability to provide rentals, new sales, used sales, aftermarket parts, and service to a variety of end market customers. This is in sync with the company’s intention to grow via four strategic priorities, one of which is focused on buyouts to grow its aftermarket business. Earlier in September, Manitowoc completed the acquisition of all the assets of Aspen Equipment Company, a diversified crane dealer and a leading final-stage, purpose-built work truck upfitter, for approximately $51 million.
Outlook
Manitowoc has been witnessing positive trends in crane demand. It anticipates rising inflation, supply chain shortages, and skilled labor constraints to impact results in the remaining part of the year and in 2022 as well.
Manitowoc expects revenues in the range of $1.725 to $1.775 billion, down from the prior expectation of $1.775 to $1.825 billion in 2021. Adjusted EBITDA is now anticipated between $100 million and $110 million, compared with the prior guidance of $105-$115 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -60.42% due to these changes.
VGM Scores
Currently, The Manitowoc Company, Inc. has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, The Manitowoc Company, Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.