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Silgan (SLGN) Down 1% Since Last Earnings Report: Can It Rebound?
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It has been about a month since the last earnings report for Silgan Holdings (SLGN - Free Report) . Shares have lost about 1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Silgan 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.
Silgan Earnings & Sales Top Estimates in Q4, Up Y/Y
Silgan Holdings reported fourth-quarter 2021 adjusted EPS of a record 79 cents, beating the Zacks Consensus Estimate of 73 cents. The bottom line increased 32% year over year from the last year’s earnings per share of 60 cents.
Including one-time items, earnings came in at 76 cents per share compared with 54 cents reported in the prior-year quarter.
Total revenues increased 17.3% year over year to $1,439 million, surpassing the Zacks Consensus Estimate of $1,358 million. The upside was driven by pass-through of higher raw material and other manufacturing costs, improved unit volumes across the Dispensing and Specialty Closures and Metal Container segments as well as a favorable mix of products sold in the Metal Container and Custom Container segments. These were partly offset by lower volumes in the Custom Container segment and the unfavorable impact of foreign currency translation.
Cost and Margins
During fourth-quarter 2021, the cost of goods sold climbed 19% year over year to $1,226 million. The gross profit increased 7% to $214 million. The gross margin came in at 15% compared with the prior-year quarter’s 16%.
Selling, general and administrative expenses were $96 million during the reported quarter compared with the year-ago quarter’s $95.7 million. The company reported operating income of $128.7 million in the quarter compared with $105 million in the prior year quarter. The operating margin was 9% in the reported quarter remained flat year over.
Segment Performance
Revenues in the Dispensing and Specialty Closures segment were up 22% year over year to $572 million. The segment’s adjusted operating income came in at $63.4 million compared with $59.9 million in the comparable period last year.
The Metal Containers segment’s revenues increased 15% year over year to $687 million. Adjusted operating income in the segment amounted to $58 million compared with the prior-year quarter’s $38 million.
In the Custom Containers segment, revenues came in at $180 million compared with the year-ago quarter’s $161 million. The segment reported an adjusted operating profit of $18 million, down from the year-earlier quarter’s $21 million.
Financial Updates
The company had cash and cash equivalents of $631 million at the end of 2021 compared with $409 million at the end of 2020. The company generated around $557 million cash from operating activities in 2021 compared with $603 million in 2020.
2021 Performance
Silgan reported record adjusted EPS of $3.40 for 2021 compared with $3.06 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $3.35. Including one-time items, the bottom line came in at $3.23, up 17% from $2.77 reported in 2020.
Sales were up 15% to $5.7 billion from the prior-year figure of $4.9 billion. The top line surpassed the Zacks Consensus Estimate of $5.6 billion.
2022 Outlook
Silgan expects adjusted EPS for 2022 between $3.80 and $4.00, suggesting year-over-year growth of 15% at the mid-point. It expects improved supply chain, labor availability and stable resin cost in the current year. Additionally, the company is on track to integrate three acquisitions completed in 2021, which are likely to provide additional significant earnings growth in 2022.
For first-quarter 2022, Silgan anticipates adjusted EPS in the range of 70-80 cents compared with 75 cents reported in first-quarter 2021.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -10% due to these changes.
VGM Scores
At this time, Silgan has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% 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, Silgan has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Silgan (SLGN) Down 1% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Silgan Holdings (SLGN - Free Report) . Shares have lost about 1% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Silgan 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.
Silgan Earnings & Sales Top Estimates in Q4, Up Y/Y
Silgan Holdings reported fourth-quarter 2021 adjusted EPS of a record 79 cents, beating the Zacks Consensus Estimate of 73 cents. The bottom line increased 32% year over year from the last year’s earnings per share of 60 cents.
Including one-time items, earnings came in at 76 cents per share compared with 54 cents reported in the prior-year quarter.
Total revenues increased 17.3% year over year to $1,439 million, surpassing the Zacks Consensus Estimate of $1,358 million. The upside was driven by pass-through of higher raw material and other manufacturing costs, improved unit volumes across the Dispensing and Specialty Closures and Metal Container segments as well as a favorable mix of products sold in the Metal Container and Custom Container segments. These were partly offset by lower volumes in the Custom Container segment and the unfavorable impact of foreign currency translation.
Cost and Margins
During fourth-quarter 2021, the cost of goods sold climbed 19% year over year to $1,226 million. The gross profit increased 7% to $214 million. The gross margin came in at 15% compared with the prior-year quarter’s 16%.
Selling, general and administrative expenses were $96 million during the reported quarter compared with the year-ago quarter’s $95.7 million. The company reported operating income of $128.7 million in the quarter compared with $105 million in the prior year quarter. The operating margin was 9% in the reported quarter remained flat year over.
Segment Performance
Revenues in the Dispensing and Specialty Closures segment were up 22% year over year to $572 million. The segment’s adjusted operating income came in at $63.4 million compared with $59.9 million in the comparable period last year.
The Metal Containers segment’s revenues increased 15% year over year to $687 million. Adjusted operating income in the segment amounted to $58 million compared with the prior-year quarter’s $38 million.
In the Custom Containers segment, revenues came in at $180 million compared with the year-ago quarter’s $161 million. The segment reported an adjusted operating profit of $18 million, down from the year-earlier quarter’s $21 million.
Financial Updates
The company had cash and cash equivalents of $631 million at the end of 2021 compared with $409 million at the end of 2020. The company generated around $557 million cash from operating activities in 2021 compared with $603 million in 2020.
2021 Performance
Silgan reported record adjusted EPS of $3.40 for 2021 compared with $3.06 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $3.35. Including one-time items, the bottom line came in at $3.23, up 17% from $2.77 reported in 2020.
Sales were up 15% to $5.7 billion from the prior-year figure of $4.9 billion. The top line surpassed the Zacks Consensus Estimate of $5.6 billion.
2022 Outlook
Silgan expects adjusted EPS for 2022 between $3.80 and $4.00, suggesting year-over-year growth of 15% at the mid-point. It expects improved supply chain, labor availability and stable resin cost in the current year. Additionally, the company is on track to integrate three acquisitions completed in 2021, which are likely to provide additional significant earnings growth in 2022.
For first-quarter 2022, Silgan anticipates adjusted EPS in the range of 70-80 cents compared with 75 cents reported in first-quarter 2021.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -10% due to these changes.
VGM Scores
At this time, Silgan has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Charting a somewhat similar path, the stock was allocated a grade of A on the value side, putting it in the top 20% 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, Silgan has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.