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Plexus (PLXS) Q2 Earnings and Revenues Surpass Estimates

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Plexus Corp. (PLXS - Free Report) reported second-quarter fiscal 2022 adjusted earnings of 95 cents per share, which declined 36.2% year over year. The Zacks Consensus Estimate stood at 83 cents per share.

Revenues of $889 million topped the consensus mark by 5.9% and inched up 0.9% year over year.

In the reported quarter, Asia-Pacific revenues rose 16.3%, while that from Europe and the Middle East and Africa and the Americas declined 10.8% and 14.8%, respectively.

During the quarter, Plexus won 38 manufacturing contracts during the quarter, worth $313 million in annualized revenues when fully ramped into production. Trailing four-quarter manufacturing wins totaled a record $1.1 billion in annualized revenues.

Plexus Corp. Price, Consensus and EPS Surprise

 

Plexus Corp. Price, Consensus and EPS Surprise

Plexus Corp. price-consensus-eps-surprise-chart | Plexus Corp. Quote

 

Market Sector Details

Industrial revenues were up 2% year over year to $415 million, contributing 47% to total revenues.

Healthcare/Life Sciences revenues inched up 0.9% from the year-ago quarter’s levels to $353 million. The segment contributed 40% to total revenues.

Aerospace/Defense revenues declined 2.4% year over year to $121 million, contributing 13% to total revenues.

The top 10 customers of the company accounted for 55% of net revenues.

Operating Details

Gross profit on a GAAP basis decreased 15.9% year over year to $76.5 million. The gross margin contracted 170 basis points (bps) to 8.6%.

Selling and administrative expenses (4.6% of revenues) increased 6.2% from the year-ago quarter to $40.7 million.

Plexus reported an adjusted operating income of $35.8 million, down 32% year over year. Adjusted operating margin contracted 200 bps to 4%.

Balance Sheet & Cash Flow

As of Apr 2, 2022, Plexus had cash & cash equivalents worth $307.9 million compared with $218.4 million as of Jan 1, 2022.

As of Apr 2, 2022, the company had long-term debt and finance lease obligations, net of the current portion of $186.1 million compared with $187.1 million as of Jan 1, 2022.

In the quarter under review, the cash flow provided by operations was $84.3 million. The company reported a free cash flow of $53.4 million. The company repurchased shares worth $25 million.

Guidance

For third-quarter fiscal 2022, revenues are projected between $885 million and $925 million.

GAAP operating margin is expected to be between 4.4% and 4.9%. GAAP earnings are expected in the range of $1.02-$1.18 per share, including 21 cents of stock-based compensation expenses.

Zacks Rank & Stocks to Consider

Plexus currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader technology sector are Flex (FLEX - Free Report) , Jabil (JBL - Free Report) and Broadcom (AVGO - Free Report) . Flex and Jabil sport a Zacks Rank #1 (Strong Buy), while Broadcom carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

The Zacks Consensus Estimate for Flex’s fiscal 2022 earnings is pegged at $1.88 per share, unchanged in the past 60 days. The long-term earnings growth rate is pegged at 14.9%.

Flex earnings beat the Zacks Consensus Estimate all last four quarters, with the average being 25.6%. Shares of FLEX have declined 9.8% in the past year.

The Zacks Consensus Estimate for Jabil fiscal 2022 earnings is pegged at $7.25 per share, up 10.2% in the past 60 dayss. The long-term earnings growth rate is 12%.

Jabil earnings beat the Zacks Consensus Estimate all last four quarters, with the average being 13.5%. Shares of JBL have gained 5.5% in the past year.

The Zacks Consensus Estimate for Broadcom’s fiscal 2022 earnings is pegged at $35.67 per share, up 7.6% in the past 60 days. AVGO’s long-term earnings growth rate is pegged at 14.5%.

Broadcom’s earnings beat the Zacks Consensus Estimate in all the preceding four quarters, with the average being 1.9%. Shares of AVGO have increased 20% in the past year.


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