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.
ABB Q4 Earnings Miss Estimates, Revenues Beat, Orders Up Y/Y
Read MoreHide Full Article
ABB Ltd. reported mixed fourth-quarter 2021 results, wherein earnings missed estimates by 2.9%, but revenues beat the same by 0.3%.
Adjusted earnings came in at 34 cents per share, lagging the Zacks Consensus Estimate of 35 cents. The bottom line recorded an increase of 30.8% on a year-over-year basis.
In 2021, the company’s earnings came in at $2.27, a decrease of 7% on a year-over-year basis.
Top-Line Details
ABB’s fourth-quarter revenues totaled $7,567 million, up 5% from the year-ago quarter. The upside can be attributed to revenue growth across most of its segments. On a comparable basis, revenues grew 8%. The top line surpassed the consensus estimate of $7,546 million.
In 2021, the company’s revenues came in at $28,945 million, up 11% year over year.
In the reported quarter, total orders were $8,257 million, increasing 18% year over year. The metric increased 21% on a comparable basis, supported by strength across its businesses. Exiting the fourth quarter, the company’s order backlog was $16,607 million, up 16% year over year.
Segmental Details
ABB reports revenues under four segments as discussed below:
Electrification: Revenues totaled $3,445 million, increasing 3% year over year. Orders were up 18% year over year to $3,638 million driven by strength across buildings, infrastructure, food & beverage, renewables, e-mobility and power conversion industries.
Process Automation: Revenues were $1,805 million, increasing 17% year over year. Orders decreased 1% to $1,898 million. The decline was due to less contribution from large orders received by the company. However, orders improved in the service business, backed by strength across the process-related markets.
Motion: Revenues amounted to $1,735 million, up 2% from the year-ago quarter. Orders increased 19% to $1,843 million on account of strength across both the short-and long-cycle businesses.
Robotics & Discrete Automation: Revenues were $799 million, relatively stable year over year. Orders grew 57% to $1,100 million. Orders improved across machine automation, the general industry as well as automotive and service robotic industries.
In the reported quarter, ABB’s total cost of sales increased 2.7% year over year to $5,170 million. It represented 68.3% of fourth-quarter revenues compared with 70.1% a year ago. Gross margin was 31.7%, up from 29.9%. Selling, general and administrative expenses increased 6.5% to $1,354 million.
Operational earnings before interest, taxes and amortization (EBITA) in the quarter increased 20% to $988 million. Operational EBITA margin increased 160 basis points to 13.1%.
Balance Sheet and Cash Flow
Exiting 2021, ABB had cash and cash equivalents of $4,159 million, up from $3,709 million recorded in the previous quarter. Long-term debt was $4,177 million, lower than $4,270 million at the end of the previous quarter.
In 2021, net cash provided by operating activities totaled $3,338 million compared with $1,875 million provided in the previous year.
In 2021, ABB paid dividends worth $1,726 million compared with $1,736 million in the previous year. In 2021, it purchased treasury stock worth $3,708 million compared with $3,048 million in the previous year.
Outlook
For the first quarter of 2022, ABB expects underlying market activity to be stable. The company expects end markets like oil and gas, buildings, mining & metals, automotive, marine & ports, renewables, food and beverage and power distribution utilities to witness growth. However, weakness in the conventional power generation end market along with supply chain challenges is likely to be a spoilsport.
For the first quarter, it anticipates revenues to be seasonally lower on a sequential basis (in absolute terms). It expects the Operational EBITA margin to be stable or marginally up in the first quarter sequentially.
For 2022, the company expects to benefit from strong market momentum and solid order backlog.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies in the industry are discussed below.
AZZ’s earnings estimates increased 2.3% for fiscal 2022 (ending February 2022) and 3.7% for fiscal 2023 (ending February 2023) in the past 30 days. Its shares have lost 12.2% in the past three months.
Franklin Electric Co., Inc. (FELE - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 16.27%, on average.
In the past 30 days, Franklin Electric’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.6% for 2022. FELE’s shares have lost 6.7% in the past three months.
SPX FLOW, Inc. (FLOW - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 40.42%, on average.
SPX FLOW’s earnings estimates have been stable for 2021 (results awaited) and increased 0.3% for 2022 in the past 30 days. FLOW’ shares have gained 11.6% in the past three months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
ABB Q4 Earnings Miss Estimates, Revenues Beat, Orders Up Y/Y
ABB Ltd. reported mixed fourth-quarter 2021 results, wherein earnings missed estimates by 2.9%, but revenues beat the same by 0.3%.
Adjusted earnings came in at 34 cents per share, lagging the Zacks Consensus Estimate of 35 cents. The bottom line recorded an increase of 30.8% on a year-over-year basis.
In 2021, the company’s earnings came in at $2.27, a decrease of 7% on a year-over-year basis.
Top-Line Details
ABB’s fourth-quarter revenues totaled $7,567 million, up 5% from the year-ago quarter. The upside can be attributed to revenue growth across most of its segments. On a comparable basis, revenues grew 8%. The top line surpassed the consensus estimate of $7,546 million.
In 2021, the company’s revenues came in at $28,945 million, up 11% year over year.
In the reported quarter, total orders were $8,257 million, increasing 18% year over year. The metric increased 21% on a comparable basis, supported by strength across its businesses. Exiting the fourth quarter, the company’s order backlog was $16,607 million, up 16% year over year.
Segmental Details
ABB reports revenues under four segments as discussed below:
Electrification: Revenues totaled $3,445 million, increasing 3% year over year. Orders were up 18% year over year to $3,638 million driven by strength across buildings, infrastructure, food & beverage, renewables, e-mobility and power conversion industries.
Process Automation: Revenues were $1,805 million, increasing 17% year over year. Orders decreased 1% to $1,898 million. The decline was due to less contribution from large orders received by the company. However, orders improved in the service business, backed by strength across the process-related markets.
Motion: Revenues amounted to $1,735 million, up 2% from the year-ago quarter. Orders increased 19% to $1,843 million on account of strength across both the short-and long-cycle businesses.
Robotics & Discrete Automation: Revenues were $799 million, relatively stable year over year. Orders grew 57% to $1,100 million. Orders improved across machine automation, the general industry as well as automotive and service robotic industries.
ABB Ltd Price, Consensus and EPS Surprise
ABB Ltd price-consensus-eps-surprise-chart | ABB Ltd Quote
Operational EBITA Margin
In the reported quarter, ABB’s total cost of sales increased 2.7% year over year to $5,170 million. It represented 68.3% of fourth-quarter revenues compared with 70.1% a year ago. Gross margin was 31.7%, up from 29.9%. Selling, general and administrative expenses increased 6.5% to $1,354 million.
Operational earnings before interest, taxes and amortization (EBITA) in the quarter increased 20% to $988 million. Operational EBITA margin increased 160 basis points to 13.1%.
Balance Sheet and Cash Flow
Exiting 2021, ABB had cash and cash equivalents of $4,159 million, up from $3,709 million recorded in the previous quarter. Long-term debt was $4,177 million, lower than $4,270 million at the end of the previous quarter.
In 2021, net cash provided by operating activities totaled $3,338 million compared with $1,875 million provided in the previous year.
In 2021, ABB paid dividends worth $1,726 million compared with $1,736 million in the previous year. In 2021, it purchased treasury stock worth $3,708 million compared with $3,048 million in the previous year.
Outlook
For the first quarter of 2022, ABB expects underlying market activity to be stable. The company expects end markets like oil and gas, buildings, mining & metals, automotive, marine & ports, renewables, food and beverage and power distribution utilities to witness growth. However, weakness in the conventional power generation end market along with supply chain challenges is likely to be a spoilsport.
For the first quarter, it anticipates revenues to be seasonally lower on a sequential basis (in absolute terms). It expects the Operational EBITA margin to be stable or marginally up in the first quarter sequentially.
For 2022, the company expects to benefit from strong market momentum and solid order backlog.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies in the industry are discussed below.
AZZ Inc. (AZZ - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Its earnings surprise for the last four quarters was 16.90%, on average.
AZZ’s earnings estimates increased 2.3% for fiscal 2022 (ending February 2022) and 3.7% for fiscal 2023 (ending February 2023) in the past 30 days. Its shares have lost 12.2% in the past three months.
Franklin Electric Co., Inc. (FELE - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 16.27%, on average.
In the past 30 days, Franklin Electric’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.6% for 2022. FELE’s shares have lost 6.7% in the past three months.
SPX FLOW, Inc. (FLOW - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 40.42%, on average.
SPX FLOW’s earnings estimates have been stable for 2021 (results awaited) and increased 0.3% for 2022 in the past 30 days. FLOW’ shares have gained 11.6% in the past three months.