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Titan Machinery (TITN) Q4 Earnings Miss Estimates, Dip Y/Y
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Titan Machinery Inc. (TITN - Free Report) reported fourth-quarter fiscal 2023 (ended Jan 31, 2023) adjusted earnings per share (EPS) of 81 cents, missing the Zacks Consensus Estimate of $1.07. The bottom line marked a decline from earnings per share of 99 cents reported in the prior-year quarter.
On a reported basis, TITN delivered an EPS of 80 cents in the fiscal fourth quarter compared with 99 cents in the prior-year quarter.
Total revenues in the fiscal fourth quarter were $583 million, up 14.9% from the figure reported in the previous fiscal year’s comparable quarter. The top line missed the consensus mark of $691 million.
Equipment revenues rose 14% year over year to $471 million and parts revenues were up 23.4% to $72 million. Revenues generated from service were $28 million in the reported quarter, up 7.7% from the year-ago quarter. Rental revenues rose 20% year over year to $12 million.
Costs and Margins
The cost of sales was up 14.8% to $474 million from the prior-year quarter. Gross profit increased 15.2% year over year to $109 million. The gross margin was 18.7%, up from 18.6% in the prior-year quarter, driven by robust equipment margins.
Operating expenses increased 30% from the prior-year quarter to $83.7 million. Adjusted EBITDA fell 11.1% year over year to $32 million. The adjusted EBITDA margin in the fiscal fourth quarter was 5.5% compared with 7.1% in the prior-year quarter.
Titan Machinery Inc. Price, Consensus and EPS Surprise
Agriculture revenues rose 27.5% year over year to $441 million. The upside was primarily driven by organic growth and recent acquisitions. The segment’s adjusted income before taxes was $19.3 million compared to $17.7 million in the year-ago quarter.
Construction revenues were $85 million in the fiscal fourth quarter, down 3.2% from the comparable quarter’s level in the prior fiscal year. Same-store sales increased 27.8% on strong equipment demand, offset by the lost contributions from Titan Machinery's Montana and Wyoming stores, following the fourth-quarter fiscal 2022 divestiture, and North Dakota stores, following the first-quarter fiscal 2023 divestiture. The segment reported an adjusted income before taxes of $5.4 million compared with the prior-year quarter’s $9 million.
International revenues were $57 million, down 22.3% from the prior-year quarter. The segment reported an adjusted income before taxes of $1.5 million compared with $3.1 million in the prior-year quarter.
Financial Position
Cash generated by operating activities was $10.8 million in fiscal 2023 compared with the prior fiscal year’s $159 million. The downside was driven by an increase in inventory. Titan Machinery ended fiscal 2023 with a cash balance of around $44 million compared with $146 million at the end of fiscal 2022. Long-term debt as of Jan 31, 2023, was around $90 million compared with $75 million as of Jan 31, 2022.
Fiscal 2023 Results
For fiscal 2023, TITN’s adjusted earnings were a record $4.52, marking a year-over-year improvement of 52%. However, the bottom line missed the Zacks Consensus Estimate of $4.82. Including one-time items, Titan Machinery’s earnings were $4.49 per share in fiscal 2023 compared with $2.92 in fiscal 2022.
Total revenues increased 29.1% from the previous-year figure to $2.21 billion, which lagged the Zacks Consensus Estimate of $2.32 billion.
Fiscal 2024 Guidance
The company expects earnings per share of $4.50-$5.10 for fiscal 2024. The Agriculture segment’s revenues are projected to grow 20-25%. The Construction segment’s revenues are projected to be flat to up 5% in fiscal 2023. International revenues are expected to increase 8-13%.
Price Performance
In the past year, shares of Titan Machinery have gained 6.7% against the industry’s fall of 2.2%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Titan Machinery currently carries a Zacks Rank #3 (Hold).
Chuy’s has an average trailing four-quarter earnings surprise of 19.1%. The Zacks Consensus Estimate for CHUY’s 2023 earnings is pegged at $1.63 per share. This indicates a 19% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved 13% north in the past 60 days. CHUY’s shares gained 29.1% in the last year.
The Zacks Consensus Estimate for Arcos Dorados’ fiscal 2023 earnings per share is pegged at 59 cents, suggesting an increase of 145.8% from that reported in the last year. The consensus estimate for fiscal 2023 earnings moved 20% upward in the last 60 days. ARCO has a trailing four-quarter average earnings surprise of 109.4%. Its shares gained 5.2% in the last year.
Booking Holdings has an average trailing four-quarter earnings surprise of 790.8%. The Zacks Consensus Estimate for BKNG’s 2023 earnings is pegged at $125.85 per share. This indicates a 26.1% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved north by 6% in the past 60 days. Its shares gained 12.9% in the last year.
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Titan Machinery (TITN) Q4 Earnings Miss Estimates, Dip Y/Y
Titan Machinery Inc. (TITN - Free Report) reported fourth-quarter fiscal 2023 (ended Jan 31, 2023) adjusted earnings per share (EPS) of 81 cents, missing the Zacks Consensus Estimate of $1.07. The bottom line marked a decline from earnings per share of 99 cents reported in the prior-year quarter.
On a reported basis, TITN delivered an EPS of 80 cents in the fiscal fourth quarter compared with 99 cents in the prior-year quarter.
Total revenues in the fiscal fourth quarter were $583 million, up 14.9% from the figure reported in the previous fiscal year’s comparable quarter. The top line missed the consensus mark of $691 million.
Equipment revenues rose 14% year over year to $471 million and parts revenues were up 23.4% to $72 million. Revenues generated from service were $28 million in the reported quarter, up 7.7% from the year-ago quarter. Rental revenues rose 20% year over year to $12 million.
Costs and Margins
The cost of sales was up 14.8% to $474 million from the prior-year quarter. Gross profit increased 15.2% year over year to $109 million. The gross margin was 18.7%, up from 18.6% in the prior-year quarter, driven by robust equipment margins.
Operating expenses increased 30% from the prior-year quarter to $83.7 million. Adjusted EBITDA fell 11.1% year over year to $32 million. The adjusted EBITDA margin in the fiscal fourth quarter was 5.5% compared with 7.1% in the prior-year quarter.
Titan Machinery Inc. Price, Consensus and EPS Surprise
Titan Machinery Inc. price-consensus-eps-surprise-chart | Titan Machinery Inc. Quote
Segmental Performance
Agriculture revenues rose 27.5% year over year to $441 million. The upside was primarily driven by organic growth and recent acquisitions. The segment’s adjusted income before taxes was $19.3 million compared to $17.7 million in the year-ago quarter.
Construction revenues were $85 million in the fiscal fourth quarter, down 3.2% from the comparable quarter’s level in the prior fiscal year. Same-store sales increased 27.8% on strong equipment demand, offset by the lost contributions from Titan Machinery's Montana and Wyoming stores, following the fourth-quarter fiscal 2022 divestiture, and North Dakota stores, following the first-quarter fiscal 2023 divestiture. The segment reported an adjusted income before taxes of $5.4 million compared with the prior-year quarter’s $9 million.
International revenues were $57 million, down 22.3% from the prior-year quarter. The segment reported an adjusted income before taxes of $1.5 million compared with $3.1 million in the prior-year quarter.
Financial Position
Cash generated by operating activities was $10.8 million in fiscal 2023 compared with the prior fiscal year’s $159 million. The downside was driven by an increase in inventory. Titan Machinery ended fiscal 2023 with a cash balance of around $44 million compared with $146 million at the end of fiscal 2022. Long-term debt as of Jan 31, 2023, was around $90 million compared with $75 million as of Jan 31, 2022.
Fiscal 2023 Results
For fiscal 2023, TITN’s adjusted earnings were a record $4.52, marking a year-over-year improvement of 52%. However, the bottom line missed the Zacks Consensus Estimate of $4.82. Including one-time items, Titan Machinery’s earnings were $4.49 per share in fiscal 2023 compared with $2.92 in fiscal 2022.
Total revenues increased 29.1% from the previous-year figure to $2.21 billion, which lagged the Zacks Consensus Estimate of $2.32 billion.
Fiscal 2024 Guidance
The company expects earnings per share of $4.50-$5.10 for fiscal 2024. The Agriculture segment’s revenues are projected to grow 20-25%. The Construction segment’s revenues are projected to be flat to up 5% in fiscal 2023. International revenues are expected to increase 8-13%.
Price Performance
In the past year, shares of Titan Machinery have gained 6.7% against the industry’s fall of 2.2%.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Titan Machinery currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Retail - Wholesale sector are Chuy's Holdings, Inc. (CHUY - Free Report) , Arcos Dorados Holdings Inc. (ARCO - Free Report) , and Booking Holdings Inc. (BKNG - Free Report) . CHUY and ARCO flaunt a Zacks Rank #1 (Strong Buy) at present, whereas BKNG has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Chuy’s has an average trailing four-quarter earnings surprise of 19.1%. The Zacks Consensus Estimate for CHUY’s 2023 earnings is pegged at $1.63 per share. This indicates a 19% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved 13% north in the past 60 days. CHUY’s shares gained 29.1% in the last year.
The Zacks Consensus Estimate for Arcos Dorados’ fiscal 2023 earnings per share is pegged at 59 cents, suggesting an increase of 145.8% from that reported in the last year. The consensus estimate for fiscal 2023 earnings moved 20% upward in the last 60 days. ARCO has a trailing four-quarter average earnings surprise of 109.4%. Its shares gained 5.2% in the last year.
Booking Holdings has an average trailing four-quarter earnings surprise of 790.8%. The Zacks Consensus Estimate for BKNG’s 2023 earnings is pegged at $125.85 per share. This indicates a 26.1% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved north by 6% in the past 60 days. Its shares gained 12.9% in the last year.