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Barnes (B) Down 12.5% In a Year: What's Hurting the Stock?
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Barnes Group, Inc. (B - Free Report) is struggling with persistent supply-chain constraints, increasing operating costs and foreign currency woes. Due to these headwinds, shares of B have lost 12.5% in the past year.
Barnes is experiencing weakness in its Industrial segment owing to disruption in global automotive production caused by continued global supply constraints and inflationary pressures. Also, the COVID-related operational disruption in the aerospace market is affecting the company’s Aerospace segment’s performance.
B’s cost of sales in the nine months of 2022 grew 4.3% on a year-over-year basis. In the third quarter of 2022, Barnes’ operating margin decreased 100 basis points year over year due to inflationary headwinds and rising interest rates. Escalating costs and expenses might continue to affect its margins and profitability in the near term.
Image Source: Zacks Investment Research
High effective tax rates are also concerning for Barnes as it might dent the bottom line. For 2022, the company predicts a 24.5% tax rate, suggesting a rise from the 21.9% recorded in 2021.
The company’s presence across diverse regions exposes it to various environmental laws and regulations in its operating countries. Adverse foreign-currency movement had an impact of 8% on its Industrial segment’s revenues in the third quarter of 2022. Barnes expects unfavorable movements in foreign currencies to hurt sales 3% in 2022.
Zacks Rank and Stocks to Consider
Barnes currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies from the Industrial Products sector are discussed below:
Image: Bigstock
Barnes (B) Down 12.5% In a Year: What's Hurting the Stock?
Barnes Group, Inc. (B - Free Report) is struggling with persistent supply-chain constraints, increasing operating costs and foreign currency woes. Due to these headwinds, shares of B have lost 12.5% in the past year.
Barnes is experiencing weakness in its Industrial segment owing to disruption in global automotive production caused by continued global supply constraints and inflationary pressures. Also, the COVID-related operational disruption in the aerospace market is affecting the company’s Aerospace segment’s performance.
B’s cost of sales in the nine months of 2022 grew 4.3% on a year-over-year basis. In the third quarter of 2022, Barnes’ operating margin decreased 100 basis points year over year due to inflationary headwinds and rising interest rates. Escalating costs and expenses might continue to affect its margins and profitability in the near term.
Image Source: Zacks Investment Research
High effective tax rates are also concerning for Barnes as it might dent the bottom line. For 2022, the company predicts a 24.5% tax rate, suggesting a rise from the 21.9% recorded in 2021.
The company’s presence across diverse regions exposes it to various environmental laws and regulations in its operating countries. Adverse foreign-currency movement had an impact of 8% on its Industrial segment’s revenues in the third quarter of 2022. Barnes expects unfavorable movements in foreign currencies to hurt sales 3% in 2022.
Zacks Rank and Stocks to Consider
Barnes currently carries a Zacks Rank #4 (Sell).
Some better-ranked companies from the Industrial Products sector are discussed below:
Applied Industrial Technologies, Inc. (AIT - Free Report) presently sports a Zacks Rank #1 (Strong Buy) and has a trailing four-quarter earnings surprise of 24.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks.
AIT’s earnings estimates have increased 4.6% for fiscal 2023 in the past 60 days. Shares of Applied Industrial have risen 24.7% in the past year.
MRC Global Inc. (MRC - Free Report) presently has a Zacks Rank of 1. MRC’s earnings surprise in the last four quarters was 103%, on average.
In the past 60 days, MRC Global’s earnings estimates have increased 42% for 2022. The stock has rallied 56.4% in the past year.
Titan International, Inc. presently carries a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 49.6%, on average.
In the past 60 days, TWI’s earnings estimates have increased 1.4% for 2022. The stock has surged 74.5% in the past year.