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Why Is Itron (ITRI) Up 6.9% Since Last Earnings Report?
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A month has gone by since the last earnings report for Itron (ITRI - Free Report) . Shares have added about 6.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Itron due for a pullback? 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.
Itron Q1 Earnings Beat Estimates
Itron reported first-quarter 2022 non-GAAP earnings of 11 cents per share, which surpassed the Zacks Consensus Estimate by 22.2%. The bottom line decreased 78.9% year over year.
Revenues were $475.3 million, which lagged the Zacks Consensus Estimate by 1.8%. Further, the top line declined 9% year over year.
The decline in the top line was attributed to component constraints, which offset robust customer demand. Sluggishness in the company’s Device Solutions and Networked Solutions segment was a major concern.
Product revenues were $399.8 million (84.1% of total revenues), down 9.7% year over year. Service revenues totaled $75.5 million (15.9%), down 1.6% from the year-ago quarter’s levels.
The company’s bookings were $417 million and the backlog totaled $3.9 billion at the end of the reported quarter.
Segments in Detail
Device Solutions: The company generated revenues of $140 million (29.4% of the total revenues) from the segment, down 19% from the year-ago quarter.
Networked Solutions: Revenues from the segment were $279 million (58.6% of the total revenues), down 3% year over year.
Outcomes: The segment generated revenues of $57 million (12% of the total revenues), down 3% on a year-over-year basis, driven by decreased product and software license sales.
Operating Details
Itron’s gross margin in the first quarter was 28.4%, which contracted 380 basis points (bps) on a year-over-year basis. The downside was caused by increasing component costs and manufacturing inefficiencies.
Non-GAAP operating expenses were $126 million, down 1.7% year over year due to lower product development expenses.
Non-GAAP operating income was $9.3 million, down 76% year over year. Operating income was $6.8 million, declining 78% from the year-ago quarter.
Non-GAAP operating margin in the first quarter was 2%, which contracted 550 bps on a year-over-year basis.
Balance Sheet & Cash Flows
As of Mar 31, 2022, cash and cash equivalents totaled $203.9 million, up from $162.5 million as of Dec 31, 2021. Accounts receivables were $303.2 million, up from $298.5 million in the prior quarter.
Long-term debt at the end of the first quarter stood at $450.8 million compared with $450.2 million at the end of the quarter ended Dec 31, 2021.
Itron generated $7.6 million of cash from operations in the reported quarter compared with $50 million in the prior quarter.
It generated a free cash flow of $2.2 million in the reported quarter compared with $38.5 million in the prior quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
The consensus estimate has shifted 5.56% due to these changes.
VGM Scores
At this time, Itron has an average Growth Score of C, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Itron has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Itron is part of the Zacks Electronics - Testing Equipment industry. Over the past month, Fortive (FTV - Free Report) , a stock from the same industry, has gained 3.7%. The company reported its results for the quarter ended March 2022 more than a month ago.
Fortive reported revenues of $1.38 billion in the last reported quarter, representing a year-over-year change of +9.3%. EPS of $0.70 for the same period compares with $0.63 a year ago.
Fortive is expected to post earnings of $0.72 per share for the current quarter, representing a year-over-year change of +9.1%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Fortive. Also, the stock has a VGM Score of C.
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Why Is Itron (ITRI) Up 6.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Itron (ITRI - Free Report) . Shares have added about 6.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Itron due for a pullback? 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.
Itron Q1 Earnings Beat Estimates
Itron reported first-quarter 2022 non-GAAP earnings of 11 cents per share, which surpassed the Zacks Consensus Estimate by 22.2%. The bottom line decreased 78.9% year over year.
Revenues were $475.3 million, which lagged the Zacks Consensus Estimate by 1.8%. Further, the top line declined 9% year over year.
The decline in the top line was attributed to component constraints, which offset robust customer demand. Sluggishness in the company’s Device Solutions and Networked Solutions segment was a major concern.
Product revenues were $399.8 million (84.1% of total revenues), down 9.7% year over year. Service revenues totaled $75.5 million (15.9%), down 1.6% from the year-ago quarter’s levels.
The company’s bookings were $417 million and the backlog totaled $3.9 billion at the end of the reported quarter.
Segments in Detail
Device Solutions: The company generated revenues of $140 million (29.4% of the total revenues) from the segment, down 19% from the year-ago quarter.
Networked Solutions: Revenues from the segment were $279 million (58.6% of the total revenues), down 3% year over year.
Outcomes: The segment generated revenues of $57 million (12% of the total revenues), down 3% on a year-over-year basis, driven by decreased product and software license sales.
Operating Details
Itron’s gross margin in the first quarter was 28.4%, which contracted 380 basis points (bps) on a year-over-year basis. The downside was caused by increasing component costs and manufacturing inefficiencies.
Non-GAAP operating expenses were $126 million, down 1.7% year over year due to lower product development expenses.
Non-GAAP operating income was $9.3 million, down 76% year over year. Operating income was $6.8 million, declining 78% from the year-ago quarter.
Non-GAAP operating margin in the first quarter was 2%, which contracted 550 bps on a year-over-year basis.
Balance Sheet & Cash Flows
As of Mar 31, 2022, cash and cash equivalents totaled $203.9 million, up from $162.5 million as of Dec 31, 2021. Accounts receivables were $303.2 million, up from $298.5 million in the prior quarter.
Long-term debt at the end of the first quarter stood at $450.8 million compared with $450.2 million at the end of the quarter ended Dec 31, 2021.
Itron generated $7.6 million of cash from operations in the reported quarter compared with $50 million in the prior quarter.
It generated a free cash flow of $2.2 million in the reported quarter compared with $38.5 million in the prior quarter.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
The consensus estimate has shifted 5.56% due to these changes.
VGM Scores
At this time, Itron has an average Growth Score of C, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Itron has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Itron is part of the Zacks Electronics - Testing Equipment industry. Over the past month, Fortive (FTV - Free Report) , a stock from the same industry, has gained 3.7%. The company reported its results for the quarter ended March 2022 more than a month ago.
Fortive reported revenues of $1.38 billion in the last reported quarter, representing a year-over-year change of +9.3%. EPS of $0.70 for the same period compares with $0.63 a year ago.
Fortive is expected to post earnings of $0.72 per share for the current quarter, representing a year-over-year change of +9.1%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Fortive. Also, the stock has a VGM Score of C.