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.
Service Corporation (SCI) Q4 Earnings Top Estimates, Sales Down
Read MoreHide Full Article
Service Corporation International (SCI - Free Report) posted decent fourth-quarter 2022 results, with the top and the bottom line beating the Zacks Consensus Estimate. However, metrics declined from the year-ago period’s levels, which was significantly impacted by the pandemic.
Quarter in Detail
Service Corporation posted adjusted earnings of 92 cents per share, surpassing the Zacks Consensus Estimate of 80 cents. However, the metric fell from $1.17 reported in the year-ago quarter. The downside was caused by softness in gross profit due to lower COVID-19 activity, increased inflationary expenses and reduced trust fund income. In addition, a lower number of shares outstanding more than offset the impact of increased interest expenses.
Total revenues of $1,027.7 million decreased from $1,043.3 million reported in the year-ago quarter. However, the top line came ahead of the Zacks Consensus Estimate of $965.5 million.
The gross profit decreased to $280.1 million from $329.3 million reported in the year-ago quarter. Corporate general and administrative costs were $107.9 million compared with $40.8 million in the year-ago period. The downside was caused by higher workers’ compensations and general liability, somewhat compensated by lower incentive compensation costs.
The operating income of almost $167 million decreased from $298.5 million reported in the year-ago quarter.
Service Corporation International Price, Consensus and EPS Surprise
Consolidated Funeral revenues came in at $580.2 million, down million from $599.7 million reported in the year-ago quarter. Total comparable funeral revenues declined 5% due to lower core funeral revenues.
Core funeral revenues fell 5.8%, mainly due to lower core funeral services performed (as the year-ago period included the impacts of the pandemic). This was somewhat offset by a rise in the core average revenue per service. Comparable preneed funeral sales production rose 5.2%.
Comparable funeral gross profit came in at $129.6 million, down $35.5 million from the year-ago quarter’s reported figure. The gross profit percentage came in at 22.9%, down from 27.7% reported in the year-ago quarter. The downside was mainly caused by a projected decline in revenues and increased energy and employee-related inflationary expenses.
Consolidated Cemetery revenues came in at $447.5 million, up from $443.5 million reported in the year-ago quarter. Comparable cemetery revenues dipped 0.3% due to soft other revenues.
Core revenues increased $3.3 million on the back of higher total recognized preneed revenue. Comparable preneed cemetery sales production fell 2.7%. Management highlighted that it continues to witness strength in sales average and large sales during the quarter. However, escalated velocity impact in the year-ago quarter stemming from the pandemic was a downside.
The comparable cemetery gross profit fell by $18.3 million to $146.1 million. The gross profit percentage contracted from 37.1% to 33% in the quarter under review.
Other Financial Details
Service Corporation ended the quarter with cash and cash equivalents of $191.9 million, long-term debt of $4,251.1 million and total equity of $1,673.4 million.
Net cash from operating activities amounted to $825.7 million during the 12 months ended Dec 31, 2022. During the same period, the company incurred capital expenditures of $369.7 million.
Image Source: Zacks Investment Research
2023 Guidance
Service Corporation expects adjusted earnings per share (EPS) in the range of $3.45-$3.75. We note that the company’s earnings came in at $3.80 per share in 2022.
Net cash provided by operating activities (excluding special items and cash taxes) is anticipated in the range of $910-$960 million. Net cash provided by operating activities (excluding special items) is anticipated in the range of $740-$800 million.
Management expects maintenance capital expenditures in the band of $290-$310 million in 2023.
Shares of this Zacks Rank #3 (Hold) company have gained 1.9% in the past three months compared with the industry’s 4.4% growth.
Conagra, a consumer-packaged goods food company, currently sports a Zacks Rank #1 (Strong Buy). CAG has a trailing four-quarter earnings surprise of 8.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Conagra’s current fiscal year sales and earnings suggests growth of 7.2% and 12.7%, respectively, from the corresponding year-ago reported figures.
Lamb Weston, which is a frozen potato product company, currently sports a Zacks Rank #1. LW has a trailing four-quarter earnings surprise of 52.6%, on average.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal year sales and earnings suggests an increase of 19.6% and 90.4%, respectively, from the year-ago reported number.
Mondelez International, which manufactures, markets, and sells snack food and beverage products, carries a Zacks Rank 2 (Buy). MDLZ has a trailing four-quarter earnings surprise of 7.5%, on average.
The Zacks Consensus Estimate for Mondelez’s current financial year sales and earnings suggests growth of 9% and 7.5%, respectively, from the corresponding year-ago reported figures.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Service Corporation (SCI) Q4 Earnings Top Estimates, Sales Down
Service Corporation International (SCI - Free Report) posted decent fourth-quarter 2022 results, with the top and the bottom line beating the Zacks Consensus Estimate. However, metrics declined from the year-ago period’s levels, which was significantly impacted by the pandemic.
Quarter in Detail
Service Corporation posted adjusted earnings of 92 cents per share, surpassing the Zacks Consensus Estimate of 80 cents. However, the metric fell from $1.17 reported in the year-ago quarter. The downside was caused by softness in gross profit due to lower COVID-19 activity, increased inflationary expenses and reduced trust fund income. In addition, a lower number of shares outstanding more than offset the impact of increased interest expenses.
Total revenues of $1,027.7 million decreased from $1,043.3 million reported in the year-ago quarter. However, the top line came ahead of the Zacks Consensus Estimate of $965.5 million.
The gross profit decreased to $280.1 million from $329.3 million reported in the year-ago quarter. Corporate general and administrative costs were $107.9 million compared with $40.8 million in the year-ago period. The downside was caused by higher workers’ compensations and general liability, somewhat compensated by lower incentive compensation costs.
The operating income of almost $167 million decreased from $298.5 million reported in the year-ago quarter.
Service Corporation International Price, Consensus and EPS Surprise
Service Corporation International price-consensus-eps-surprise-chart | Service Corporation International Quote
Segment Discussion
Consolidated Funeral revenues came in at $580.2 million, down million from $599.7 million reported in the year-ago quarter. Total comparable funeral revenues declined 5% due to lower core funeral revenues.
Core funeral revenues fell 5.8%, mainly due to lower core funeral services performed (as the year-ago period included the impacts of the pandemic). This was somewhat offset by a rise in the core average revenue per service. Comparable preneed funeral sales production rose 5.2%.
Comparable funeral gross profit came in at $129.6 million, down $35.5 million from the year-ago quarter’s reported figure. The gross profit percentage came in at 22.9%, down from 27.7% reported in the year-ago quarter. The downside was mainly caused by a projected decline in revenues and increased energy and employee-related inflationary expenses.
Consolidated Cemetery revenues came in at $447.5 million, up from $443.5 million reported in the year-ago quarter. Comparable cemetery revenues dipped 0.3% due to soft other revenues.
Core revenues increased $3.3 million on the back of higher total recognized preneed revenue. Comparable preneed cemetery sales production fell 2.7%. Management highlighted that it continues to witness strength in sales average and large sales during the quarter. However, escalated velocity impact in the year-ago quarter stemming from the pandemic was a downside.
The comparable cemetery gross profit fell by $18.3 million to $146.1 million. The gross profit percentage contracted from 37.1% to 33% in the quarter under review.
Other Financial Details
Service Corporation ended the quarter with cash and cash equivalents of $191.9 million, long-term debt of $4,251.1 million and total equity of $1,673.4 million.
Net cash from operating activities amounted to $825.7 million during the 12 months ended Dec 31, 2022. During the same period, the company incurred capital expenditures of $369.7 million.
Image Source: Zacks Investment Research
2023 Guidance
Service Corporation expects adjusted earnings per share (EPS) in the range of $3.45-$3.75. We note that the company’s earnings came in at $3.80 per share in 2022.
Net cash provided by operating activities (excluding special items and cash taxes) is anticipated in the range of $910-$960 million. Net cash provided by operating activities (excluding special items) is anticipated in the range of $740-$800 million.
Management expects maintenance capital expenditures in the band of $290-$310 million in 2023.
Shares of this Zacks Rank #3 (Hold) company have gained 1.9% in the past three months compared with the industry’s 4.4% growth.
Solid Staple Picks
Some better-ranked stocks are Conagra Brands (CAG - Free Report) , Lamb Weston (LW - Free Report) and Mondelez International, Inc. (MDLZ - Free Report) .
Conagra, a consumer-packaged goods food company, currently sports a Zacks Rank #1 (Strong Buy). CAG has a trailing four-quarter earnings surprise of 8.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Conagra’s current fiscal year sales and earnings suggests growth of 7.2% and 12.7%, respectively, from the corresponding year-ago reported figures.
Lamb Weston, which is a frozen potato product company, currently sports a Zacks Rank #1. LW has a trailing four-quarter earnings surprise of 52.6%, on average.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal year sales and earnings suggests an increase of 19.6% and 90.4%, respectively, from the year-ago reported number.
Mondelez International, which manufactures, markets, and sells snack food and beverage products, carries a Zacks Rank 2 (Buy). MDLZ has a trailing four-quarter earnings surprise of 7.5%, on average.
The Zacks Consensus Estimate for Mondelez’s current financial year sales and earnings suggests growth of 9% and 7.5%, respectively, from the corresponding year-ago reported figures.