We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Titan Machinery (TITN) to Acquire Heartland Ag Systems
Read MoreHide Full Article
Titan Machinery Inc. (TITN - Free Report) recently entered into an agreement to acquire Heartland Ag Systems — the largest distributor of Case IH application equipment in North America. The deal valued at $110 million is expected to be settled in cash. The buyout enhances TITN’s product portfolio by providing access to a full line of Case IH application equipment, including self-propelled sprayers and fertilizer applicators. It will have a complete distribution model covering both farmers and commercial applicators. TITN anticipates immediate revenue synergies in the first full fiscal year of ownership, estimated to be approximately $60 million of run-rate sales, which will translate to approximately 13 cents of earnings per share.
Titan Machinery and its subsidiaries own and operate a network of full-service agricultural and construction equipment stores in the United States and Europe. It has been an authorized dealer of CNH Industrial (CNHI - Free Report) since its inception in 1980. CNH Industrial is a leading manufacturer and supplier of agricultural and construction equipment, which includes the Case IH Agriculture, New Holland Agriculture, Case Construction and New Holland Construction brands.
Heartland has been in operation for over five decades and currently has exclusive distribution agreements across 17 midwestern and northwestern states. This is supported by 12 retail stores, six of which are within Titan Machinery’s existing agriculture footprint. The company has an agriculture and related commercial application equipment manufacturing plant and headquarters in Hutchinson, MN. Heartland Ag Systems generated revenues of $213.9 million and EBITDA of $15.3 million in 2021. Heartland’s business is well diversified with a strong parts & service business that generated around 30% of its revenues in 2021. The company generated pre-tax margins of 4.2%.
The transaction, subject to customary closing conditions, is expected to close next month. The deal equates to approximately $274 million in revenues, 43 cents in earnings per share, and $19.5 million in EBITDA. TITN anticipates additional long-term pre-tax margin expansion opportunities by leveraging its existing infrastructure, optimizing existing operations, and growing the Parts & Service business.
Titan Machinery has updated its guidance for fiscal 2023, reflecting the partial year accretion of the transaction. It expects Agriculture revenues to increase 37-42% from the last full-fiscal level, higher than the 27-32% expected earlier. The Construction segment’s revenue growth is projected to be down 10-15% from the last fiscal year’s actuals. The International segment’s revenues are expected to decrease 0-5%. TITN anticipates EPS for fiscal 2023 between $2.90 and $3.20, up from the previous guidance of $2.85 and $3.15. The mid-point of the revised guidance indicates a 2% growth from $2.98 earnings per share in fiscal 2022.
Share Price Performance
Image Source: Zacks Investment Research
In the past year, shares of Titan Machinery have fallen 17.5% compared with the industry’s decline of 1.5%.
Here are two other top-ranked stocks in the retail-wholesale sector, namely, Penske Automotive Group (PAG - Free Report) and AutoNation (AN - Free Report) .
Penske Automotive flaunts a Zacks Rank #1. It has an expected earnings growth rate of 17.7% for the current fiscal year. The Zacks Consensus Estimate for PAG’s earnings for the current fiscal has been revised 7% upward in the past 60 days.
Penske Automotive has a trailing four-quarter earnings surprise of 17.7%, on average. PAG has appreciated 12% over the last three months.
The Zacks Consensus Estimate for AutoNation’s current financial year earnings per share suggests growth of 27.9% from the year-ago reported figure. The Zacks Consensus Estimate for AN's current-year earnings has been revised 5% upward in the past 60 days.
AN has a trailing four-quarter earnings surprise of 27.4%, on average. AN has gained roughly 12% in three-months time. It carries a Zacks Rank #2 (Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Titan Machinery (TITN) to Acquire Heartland Ag Systems
Titan Machinery Inc. (TITN - Free Report) recently entered into an agreement to acquire Heartland Ag Systems — the largest distributor of Case IH application equipment in North America. The deal valued at $110 million is expected to be settled in cash. The buyout enhances TITN’s product portfolio by providing access to a full line of Case IH application equipment, including self-propelled sprayers and fertilizer applicators. It will have a complete distribution model covering both farmers and commercial applicators. TITN anticipates immediate revenue synergies in the first full fiscal year of ownership, estimated to be approximately $60 million of run-rate sales, which will translate to approximately 13 cents of earnings per share.
Titan Machinery and its subsidiaries own and operate a network of full-service agricultural and construction equipment stores in the United States and Europe. It has been an authorized dealer of CNH Industrial (CNHI - Free Report) since its inception in 1980. CNH Industrial is a leading manufacturer and supplier of agricultural and construction equipment, which includes the Case IH Agriculture, New Holland Agriculture, Case Construction and New Holland Construction brands.
Heartland has been in operation for over five decades and currently has exclusive distribution agreements across 17 midwestern and northwestern states. This is supported by 12 retail stores, six of which are within Titan Machinery’s existing agriculture footprint. The company has an agriculture and related commercial application equipment manufacturing plant and headquarters in Hutchinson, MN. Heartland Ag Systems generated revenues of $213.9 million and EBITDA of $15.3 million in 2021. Heartland’s business is well diversified with a strong parts & service business that generated around 30% of its revenues in 2021. The company generated pre-tax margins of 4.2%.
The transaction, subject to customary closing conditions, is expected to close next month. The deal equates to approximately $274 million in revenues, 43 cents in earnings per share, and $19.5 million in EBITDA. TITN anticipates additional long-term pre-tax margin expansion opportunities by leveraging its existing infrastructure, optimizing existing operations, and growing the Parts & Service business.
Titan Machinery has updated its guidance for fiscal 2023, reflecting the partial year accretion of the transaction. It expects Agriculture revenues to increase 37-42% from the last full-fiscal level, higher than the 27-32% expected earlier. The Construction segment’s revenue growth is projected to be down 10-15% from the last fiscal year’s actuals. The International segment’s revenues are expected to decrease 0-5%. TITN anticipates EPS for fiscal 2023 between $2.90 and $3.20, up from the previous guidance of $2.85 and $3.15. The mid-point of the revised guidance indicates a 2% growth from $2.98 earnings per share in fiscal 2022.
Share Price Performance
Image Source: Zacks Investment Research
In the past year, shares of Titan Machinery have fallen 17.5% compared with the industry’s decline of 1.5%.
Zacks Rank & Other Stocks to Consider
Titan Machinery currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Here are two other top-ranked stocks in the retail-wholesale sector, namely, Penske Automotive Group (PAG - Free Report) and AutoNation (AN - Free Report) .
Penske Automotive flaunts a Zacks Rank #1. It has an expected earnings growth rate of 17.7% for the current fiscal year. The Zacks Consensus Estimate for PAG’s earnings for the current fiscal has been revised 7% upward in the past 60 days.
Penske Automotive has a trailing four-quarter earnings surprise of 17.7%, on average. PAG has appreciated 12% over the last three months.
The Zacks Consensus Estimate for AutoNation’s current financial year earnings per share suggests growth of 27.9% from the year-ago reported figure. The Zacks Consensus Estimate for AN's current-year earnings has been revised 5% upward in the past 60 days.
AN has a trailing four-quarter earnings surprise of 27.4%, on average. AN has gained roughly 12% in three-months time. It carries a Zacks Rank #2 (Buy).