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Valmont (VMI) Earnings & Revenues Surpass Estimates in Q1

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Valmont Industries, Inc. (VMI - Free Report) registered profits of $62.3 million or $2.90 per share in first-quarter 2022, up from $55 million or $2.57 per share in the year-ago quarter.

Barring one-time items, adjusted earnings were $3.07 per share in the reported quarter, beating the Zacks Consensus Estimate of $2.30.

Revenues in the quarter were $980.8 million, up 26.6% year over year. The figure also surpassed the Zacks Consensus Estimate of $885.1 million.  Sales were driven by favorable pricing and higher volumes.

Valmont Industries, Inc. Price, Consensus and EPS Surprise

 

Valmont Industries, Inc. Price, Consensus and EPS Surprise

Valmont Industries, Inc. price-consensus-eps-surprise-chart | Valmont Industries, Inc. Quote

 

Segment Highlights

On Apr 6, 2022, the company announced that it had realigned its reporting segment structure beginning with the first-quarter 2022 results. The new reporting segments are Infrastructure (consists of the previous Utility Support Structures, Engineered Support Structures and Coatings) and Agriculture (a renaming of the Irrigation segment).

Sales in the Infrastructure segment increased 23.8% year over year to $680.7 million in the reported quarter. This was led by favorable pricing globally and increased volumes, especially for telecommunication products.

Sales in the Agriculture segment rose 33.5% year over year to $306.6 million. The upside was driven by higher pricing of irrigation equipment worldwide, higher volumes in North American markets and increased technology sales.

Financial Position

Valmont ended the first quarter with cash and cash equivalents of $149.7 million, down 61.8% year over year. Long-term debt stood at around $963 million, up 32% year over year.

Cash flows from operating activities were $2.7 million for the quarter (as of Mar 26, 2022), down from $33.2 million for the same period a year ago (as of Mar 27, 2021).

Outlook

Valmont revised its outlook for 2022. It expects net sales growth for 2022 in the range of 11-17% year over year, up from 9-14% expected earlier. The company expects earnings per share (EPS) in the range of $12.30-$12.80 for the year, up from $11.55-$12.30 expected earlier. Adjusted EPS are now projected in the band of $13-$13.50, up from the prior forecast of $12.25-$13.

Valmont projects capital expenditures in the range of $110-$120 million for 2022.

The company raised its outlook due to several positive drivers. Valmont continued to execute from a position of strength to drive growth and performance, with significant momentum led by strong, global market drivers across its businesses. The company entered the second quarter with a record backlog, indicating strong market demand. It also continues to execute pricing strategies to manage inflation.

Price Performance

The company’s shares have increased 9.2% in the past year compared with a 29.6% rise of the industry.

Zacks Investment Research
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Zacks Rank & Key Picks

Valmont currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are The Mosaic Company (MOS - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) .

Mosaic has a projected earnings growth rate of 143.5% for the current year. The Zacks Consensus Estimate for MOS' current-year earnings has been revised 39.7% upward in the past 60 days.

Mosaic’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, while missing once. It delivered a trailing four-quarter earnings surprise of roughly 3.7%, on average. MOS has rallied around 102.2% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

AdvanSix has a projected earnings growth rate of 54.7% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 43.6% upward in the past 60 days.

AdvanSix’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 23.6%. ASIX has surged 73.5% in a year. The company sports a Zacks Rank #1.

Allegheny, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 684.6% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised 20% upward in the past 60 days.

Allegheny’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 127.2%. ATI has rallied around 24.6% over a year.


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