We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Orion (OESX) Pulls FY'22 Revenue View on Supply Chain Issues
Read MoreHide Full Article
Orion Energy Systems, Inc.’s (OESX - Free Report) shares fell 13.5% in the after-hours trading session on Jan 18, after it provided tepid guidance for third-quarter and fiscal 2022 revenues. The company expects third-quarter fiscal 2022 revenues to be $30.5 million, indicating a 31.2% decline from $44.3 million reported a year ago. Also, it has cut view for fiscal 2022 revenues to $130 million from $150 million anticipated earlier. The updated fiscal 2022 guidance indicates 11% year-over-year growth.
Orion noted that customer delays of several larger LED lighting and controls projects, primarily owing to supply chain disruptions and COVID-related impacts on businesses, are ailing the company. A few of these project delays are due to a major automotive customer that has postponed approximately $7 million project activity mainly on the impact of component shortages in operations; a major online retailer that has temporarily halted construction of new facilities due to shortages of key construction materials and equipment, impacting roughly $5 million project activity; a government-related turnkey LED retrofit project delay having a value of approximately $7 million; and slower-than-expected activity with two large national logistics customers.
It is to be noted that the company has not lost any of these projects and is likely to regain momentum as customers overcome supply-chain and COVID-related challenges. Impressively, OESX remains confident about the nationwide lighting and electrical maintenance service platform that is expected to generate annual recurring revenues of more than $20 million in fiscal 2023.
Image Source: Zacks Investment Research
Mike Altschaefl, Orion’s CEO and Board Chair, said, “Our Board and management team remain committed to and confident in achieving the Company’s long-term strategic plan which seeks to grow the business, via organic and inorganic initiatives, into a company with $500M in annual revenue over approximately five years. Orion’s strategic plan envisions organic growth averaging at least 10% per year, augmented by external growth, including strategic acquisitions, business partnerships and other initiatives.” He continued, “Orion remains well-funded to support our strategic growth plan with a quarter-end cash position of approximately $17M and availability of approximately $24M under our credit facility after funding the Stay-Lite acquisition.”
OESX shares have declined 21.3% in the past six months against the Zacks Building Products - Lighting industry’s 16.4% growth. Earnings estimates for the fiscal third quarter indicate a 28.6% year-over-year decline. Revenue estimates are pegged at $41.06 million, indicating 7.2% year-over-year fall. The company missed the consensus mark in two of the last four quarters, with an average negative surprise of 12%.
Over the last few quarters, Orion has been witnessing supply chain disruptions, shipping and logistics issues, component availability, rising input costs, labor supply challenges, risks of a rise in the cases of COVID-19 and other variants, and other potential business and economic impacts.
Stocks to Consider
D.R. Horton, Inc. (DHI - Free Report) : This Texas-based prime homebuilder continues to gain from industry-leading market share, a solid acquisition strategy, a well-stocked supply of land, lots, and homes along with affordable product offerings across multiple brands.
DHI currently carries a Zacks Rank #2 (Buy). Its earnings are expected to rise 27.1% in fiscal 2022.
Meritage Homes Corporation (MTH - Free Report) : Based in Scottsdale, AZ, Meritage Homes is one of the leading designers and builders of single-family homes. Its focus on entry-level LiVE.NOW homes has been a major driving factor.
MTH currently carries a Zacks Rank #2. Its earnings are expected to grow 74.1% in 2021 and 23.7% in the next.
PulteGroup, Inc. (PHM - Free Report) : This Atlanta, GA-based homebuilder engages in homebuilding and financial services businesses, primarily in the United States. Its annual land acquisition strategies have been resulting in improved volumes, revenues and profitability for quite some time now.
PHM currently carries a Zacks Rank #2. Its earnings are expected to grow 37.3% in 2021 and 23.8% in the next.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Shutterstock
Orion (OESX) Pulls FY'22 Revenue View on Supply Chain Issues
Orion Energy Systems, Inc.’s (OESX - Free Report) shares fell 13.5% in the after-hours trading session on Jan 18, after it provided tepid guidance for third-quarter and fiscal 2022 revenues. The company expects third-quarter fiscal 2022 revenues to be $30.5 million, indicating a 31.2% decline from $44.3 million reported a year ago. Also, it has cut view for fiscal 2022 revenues to $130 million from $150 million anticipated earlier. The updated fiscal 2022 guidance indicates 11% year-over-year growth.
Orion noted that customer delays of several larger LED lighting and controls projects, primarily owing to supply chain disruptions and COVID-related impacts on businesses, are ailing the company. A few of these project delays are due to a major automotive customer that has postponed approximately $7 million project activity mainly on the impact of component shortages in operations; a major online retailer that has temporarily halted construction of new facilities due to shortages of key construction materials and equipment, impacting roughly $5 million project activity; a government-related turnkey LED retrofit project delay having a value of approximately $7 million; and slower-than-expected activity with two large national logistics customers.
It is to be noted that the company has not lost any of these projects and is likely to regain momentum as customers overcome supply-chain and COVID-related challenges. Impressively, OESX remains confident about the nationwide lighting and electrical maintenance service platform that is expected to generate annual recurring revenues of more than $20 million in fiscal 2023.
Mike Altschaefl, Orion’s CEO and Board Chair, said, “Our Board and management team remain committed to and confident in achieving the Company’s long-term strategic plan which seeks to grow the business, via organic and inorganic initiatives, into a company with $500M in annual revenue over approximately five years. Orion’s strategic plan envisions organic growth averaging at least 10% per year, augmented by external growth, including strategic acquisitions, business partnerships and other initiatives.” He continued, “Orion remains well-funded to support our strategic growth plan with a quarter-end cash position of approximately $17M and availability of approximately $24M under our credit facility after funding the Stay-Lite acquisition.”
This Zacks Rank #3 (Hold) company is slated to release fiscal third-quarter results on Feb 9. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Share Price Performance
OESX shares have declined 21.3% in the past six months against the Zacks Building Products - Lighting industry’s 16.4% growth. Earnings estimates for the fiscal third quarter indicate a 28.6% year-over-year decline. Revenue estimates are pegged at $41.06 million, indicating 7.2% year-over-year fall. The company missed the consensus mark in two of the last four quarters, with an average negative surprise of 12%.
Over the last few quarters, Orion has been witnessing supply chain disruptions, shipping and logistics issues, component availability, rising input costs, labor supply challenges, risks of a rise in the cases of COVID-19 and other variants, and other potential business and economic impacts.
Stocks to Consider
D.R. Horton, Inc. (DHI - Free Report) : This Texas-based prime homebuilder continues to gain from industry-leading market share, a solid acquisition strategy, a well-stocked supply of land, lots, and homes along with affordable product offerings across multiple brands.
DHI currently carries a Zacks Rank #2 (Buy). Its earnings are expected to rise 27.1% in fiscal 2022.
Meritage Homes Corporation (MTH - Free Report) : Based in Scottsdale, AZ, Meritage Homes is one of the leading designers and builders of single-family homes. Its focus on entry-level LiVE.NOW homes has been a major driving factor.
MTH currently carries a Zacks Rank #2. Its earnings are expected to grow 74.1% in 2021 and 23.7% in the next.
PulteGroup, Inc. (PHM - Free Report) : This Atlanta, GA-based homebuilder engages in homebuilding and financial services businesses, primarily in the United States. Its annual land acquisition strategies have been resulting in improved volumes, revenues and profitability for quite some time now.
PHM currently carries a Zacks Rank #2. Its earnings are expected to grow 37.3% in 2021 and 23.8% in the next.