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Why Is Silgan (SLGN) Up 0.8% Since Last Earnings Report?
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It has been about a month since the last earnings report for Silgan Holdings (SLGN - Free Report) . Shares have added about 0.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Silgan 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.
Silgan Q4 Earnings Top Estimates, Sales Rise Y/Y
Silgan Holdings Inc. reported adjusted earnings of 84 cents per share in fourth-quarter 2022, beating the Zacks Consensus Estimate of 81 cents per share. The bottom line increased 6% year over year.
Including one-time items, earnings were 22 cents per share compared with 76 cents per share reported in the prior-year quarter.
Total revenues increased year over year to $1,455 million from the prior-year quarter’s $1,439 million. The top line missed the Zacks Consensus Estimate of $1,547 million. The upside was driven by the pass-through of higher raw material and other manufacturing costs; improved unit volumes across the Dispensing and Specialty Closures, and Metal Container segments, and a favorable mix of products sold in the Metal Container and Custom Container segments. These were partly offset by lower volumes across all segments and the unfavorable impacts of foreign currency translation.
Costs and Margins
In fourth-quarter 2022, the cost of goods sold decreased 0.2% year over year to $1,223 million. The gross profit increased 7.3% to $233 million. The gross margin was 16% compared with the prior-year quarter’s 15%.
Selling, general and administrative expenses were $96.5 million in the reported quarter compared with the year-ago quarter’s $96 million. The company reported an operating income of $81 million in the quarter compared with $128 million in the prior-year quarter. The operating margin was 5.6% in the reported quarter compared with the prior-year quarter’s 8.9%.
Segmental Performance
Revenues in the Dispensing and Specialty Closures segment were down 5.4% year over year to $541 million in the fourth quarter. The segment’s operating income was $65 million compared with $63 million in the prior-year period.
The Metal Containers segment’s revenues in the fourth quarter increased 9.8% year over year to $755 million. Operating income in the segment amounted to $8 million, a decline of 84% from the prior-year quarter.
In the Custom Containers segment, revenues were $160 million compared with the year-ago quarter’s $180 million. The segment reported an income of $13 million, down from the previous year’s $18 million.
Financial Updates
The company had cash and cash equivalents of $586 million at the end of 2022 compared with $631.4 million at the end of 2021. It generated around $748 million in cash from operating activities in 2022 compared with $557 million in 2021.
2022 Performance
Silgan reported record adjusted earnings per share (EPS) of $3.98 for 2022 compared with $3.40 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $3.95. Including one-time items, the bottom line was $3.07, down 4.9% from the $3.23 reported in 2021.
Sales were up 12.9% to a record $6.4 billion from the prior-year figure of $5.7 billion. The top line was in line with the Zacks Consensus Estimate.
Revenues in the Dispensing and Specialty Closures segment reached $2.32 billion in 2022, up 7.2% from the 2021 level. Revenues of the Metal Containers segment were a record $3.37 billion for 2022, a 20.1% increase from 2021. Net sales of the Custom Containers segment increased 2% to $723 million in 2022.
2023 Outlook
Silgan expects 2023 adjusted EPS between $3.95 and $4.15, including a headwind of 20 cents per share for additional interest expenses.
For first-quarter 2023, Silgan anticipates adjusted EPS of 75-85 cents, whereas it reported 79 cents in first-quarter 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -10.84% due to these changes.
VGM Scores
Currently, Silgan has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Silgan has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Silgan (SLGN) Up 0.8% Since Last Earnings Report?
It has been about a month since the last earnings report for Silgan Holdings (SLGN - Free Report) . Shares have added about 0.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Silgan 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.
Silgan Q4 Earnings Top Estimates, Sales Rise Y/Y
Silgan Holdings Inc. reported adjusted earnings of 84 cents per share in fourth-quarter 2022, beating the Zacks Consensus Estimate of 81 cents per share. The bottom line increased 6% year over year.
Including one-time items, earnings were 22 cents per share compared with 76 cents per share reported in the prior-year quarter.
Total revenues increased year over year to $1,455 million from the prior-year quarter’s $1,439 million. The top line missed the Zacks Consensus Estimate of $1,547 million. The upside was driven by the pass-through of higher raw material and other manufacturing costs; improved unit volumes across the Dispensing and Specialty Closures, and Metal Container segments, and a favorable mix of products sold in the Metal Container and Custom Container segments. These were partly offset by lower volumes across all segments and the unfavorable impacts of foreign currency translation.
Costs and Margins
In fourth-quarter 2022, the cost of goods sold decreased 0.2% year over year to $1,223 million. The gross profit increased 7.3% to $233 million. The gross margin was 16% compared with the prior-year quarter’s 15%.
Selling, general and administrative expenses were $96.5 million in the reported quarter compared with the year-ago quarter’s $96 million. The company reported an operating income of $81 million in the quarter compared with $128 million in the prior-year quarter. The operating margin was 5.6% in the reported quarter compared with the prior-year quarter’s 8.9%.
Segmental Performance
Revenues in the Dispensing and Specialty Closures segment were down 5.4% year over year to $541 million in the fourth quarter. The segment’s operating income was $65 million compared with $63 million in the prior-year period.
The Metal Containers segment’s revenues in the fourth quarter increased 9.8% year over year to $755 million. Operating income in the segment amounted to $8 million, a decline of 84% from the prior-year quarter.
In the Custom Containers segment, revenues were $160 million compared with the year-ago quarter’s $180 million. The segment reported an income of $13 million, down from the previous year’s $18 million.
Financial Updates
The company had cash and cash equivalents of $586 million at the end of 2022 compared with $631.4 million at the end of 2021. It generated around $748 million in cash from operating activities in 2022 compared with $557 million in 2021.
2022 Performance
Silgan reported record adjusted earnings per share (EPS) of $3.98 for 2022 compared with $3.40 reported in the prior year. Earnings beat the Zacks Consensus Estimate of $3.95. Including one-time items, the bottom line was $3.07, down 4.9% from the $3.23 reported in 2021.
Sales were up 12.9% to a record $6.4 billion from the prior-year figure of $5.7 billion. The top line was in line with the Zacks Consensus Estimate.
Revenues in the Dispensing and Specialty Closures segment reached $2.32 billion in 2022, up 7.2% from the 2021 level. Revenues of the Metal Containers segment were a record $3.37 billion for 2022, a 20.1% increase from 2021. Net sales of the Custom Containers segment increased 2% to $723 million in 2022.
2023 Outlook
Silgan expects 2023 adjusted EPS between $3.95 and $4.15, including a headwind of 20 cents per share for additional interest expenses.
For first-quarter 2023, Silgan anticipates adjusted EPS of 75-85 cents, whereas it reported 79 cents in first-quarter 2022.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -10.84% due to these changes.
VGM Scores
Currently, Silgan has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Silgan has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.