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Why Is Oshkosh (OSK) Down 6.5% Since Last Earnings Report?
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A month has gone by since the last earnings report for Oshkosh (OSK - Free Report) . Shares have lost about 6.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Oshkosh 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.
Oshkosh Reports Weak Stub Period Earnings
Oshkosh reported adjusted earnings of 9 cents per share for the three months ended Dec 31, 2021. The bottom line also decreased from $1.01 recorded in the three months ended Dec 31, 2020.Higher material and logistics costs, and an adverse product mix affected the company’s income.
In October, Oshkosh’s board of directors had approved a change in the company’s fiscal year to a calendar year (Jan 1- Dec 31). Historically, Oshkosh’s fiscal year began on Oct 1 and ended on Sep 30. So, the latest earnings announcement is for the stub period (three months ending Dec 31, 2021).
In the quarter under review, consolidated net sales jumped 13.7% year over year to $1,791.7 million on the back of a rebound in demand in the Access Equipment segment in North America.
Segmental Details
During the quarter under discussion, net sales in Access Equipment surged 47.9% year over year to $833.5 million on improved market demand in North America. Operating income climbed 29.7% to $32.3 million (accounting for 3.9% of sales) on the back of higher sales volume, improved pricing and manufacturing absorption, a favorable regional sales mix and the absence of restructuring charges.
The Defense segment’s net sales fell 3.4% year over year to $531.5 million, led by lower volumes of Medium and Heavy Tactical Vehicle programs, along with reduced aftermarket parts & services sales. The operating income plunged 79.9% from the prior-year figure to $10.6 million (2% of sales). The downslide resulted from higher material costs, offsetting the benefit of the JLTV order.
Net sales in the Fire & Emergency segment totaled $218.6 million, decreasing 20.2% year over year. Lower aircraft rescue and firefighting vehicle sales volume along with tightened production and delivery of Pierce fire trucks adversely impacted the top line. The segment’s operating income fell 73.5% year over year to $9.3 million (4.3% of sales) amid higher material and manufacturing costs.
Net sales in the Commercial segment increased 7.6% from the year-ago figure to $210.6 million on higher front-discharge concrete mixer volume and higher pricing led by higher input costs. The segment, however, incurred an operating loss of $3.3 million (1.6% of sales), chiefly due to higher material costs and adverse product mix.
Financials, Dividend & Buyback
Oshkosh had cash and cash equivalents of $995.7 million on Dec 31, 2021. The company recorded a long-term debt of $819 million as of Dec 31, 2021.
Oshkosh declared a quarterly cash dividend of 37 cents per share, payable Feb 25, 2022, to shareholders on record as of Feb 11, 2022.
OSK repurchased nearly 1.4 million shares of common stock for $150 million during the three months ended Dec 31.
Outlook
Steered by robust customer demand and significant backlog price realization the company stated its 2022 earnings per share expectations in the range of $5.75-$6.75 on projected net sales between $8.0 billion-$8.5 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -68.95% due to these changes.
VGM Scores
Currently, Oshkosh 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, Oshkosh has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Oshkosh (OSK) Down 6.5% Since Last Earnings Report?
A month has gone by since the last earnings report for Oshkosh (OSK - Free Report) . Shares have lost about 6.5% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Oshkosh 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.
Oshkosh Reports Weak Stub Period Earnings
Oshkosh reported adjusted earnings of 9 cents per share for the three months ended Dec 31, 2021. The bottom line also decreased from $1.01 recorded in the three months ended Dec 31, 2020.Higher material and logistics costs, and an adverse product mix affected the company’s income.
In October, Oshkosh’s board of directors had approved a change in the company’s fiscal year to a calendar year (Jan 1- Dec 31). Historically, Oshkosh’s fiscal year began on Oct 1 and ended on Sep 30. So, the latest earnings announcement is for the stub period (three months ending Dec 31, 2021).
In the quarter under review, consolidated net sales jumped 13.7% year over year to $1,791.7 million on the back of a rebound in demand in the Access Equipment segment in North America.
Segmental Details
During the quarter under discussion, net sales in Access Equipment surged 47.9% year over year to $833.5 million on improved market demand in North America. Operating income climbed 29.7% to $32.3 million (accounting for 3.9% of sales) on the back of higher sales volume, improved pricing and manufacturing absorption, a favorable regional sales mix and the absence of restructuring charges.
The Defense segment’s net sales fell 3.4% year over year to $531.5 million, led by lower volumes of Medium and Heavy Tactical Vehicle programs, along with reduced aftermarket parts & services sales. The operating income plunged 79.9% from the prior-year figure to $10.6 million (2% of sales). The downslide resulted from higher material costs, offsetting the benefit of the JLTV order.
Net sales in the Fire & Emergency segment totaled $218.6 million, decreasing 20.2% year over year. Lower aircraft rescue and firefighting vehicle sales volume along with tightened production and delivery of Pierce fire trucks adversely impacted the top line. The segment’s operating income fell 73.5% year over year to $9.3 million (4.3% of sales) amid higher material and manufacturing costs.
Net sales in the Commercial segment increased 7.6% from the year-ago figure to $210.6 million on higher front-discharge concrete mixer volume and higher pricing led by higher input costs. The segment, however, incurred an operating loss of $3.3 million (1.6% of sales), chiefly due to higher material costs and adverse product mix.
Financials, Dividend & Buyback
Oshkosh had cash and cash equivalents of $995.7 million on Dec 31, 2021. The company recorded a long-term debt of $819 million as of Dec 31, 2021.
Oshkosh declared a quarterly cash dividend of 37 cents per share, payable Feb 25, 2022, to shareholders on record as of Feb 11, 2022.
OSK repurchased nearly 1.4 million shares of common stock for $150 million during the three months ended Dec 31.
Outlook
Steered by robust customer demand and significant backlog price realization the company stated its 2022 earnings per share expectations in the range of $5.75-$6.75 on projected net sales between $8.0 billion-$8.5 billion.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
The consensus estimate has shifted -68.95% due to these changes.
VGM Scores
Currently, Oshkosh 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, Oshkosh has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.