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Plexus (PLXS) Q1 Earnings & Revenues Miss Estimates, Fall Y/Y
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Plexus Corp (PLXS - Free Report) reported first-quarter fiscal 2024 adjusted earnings per share (EPS) of $1.04, which decreased 30.2% year over year. The Zacks Consensus Estimate was pegged at $1.05 per share.
Revenues of $983 million decreased 10.2% year over year. The top-line performance was affected mainly due to weakness in the Healthcare/Life Sciences and Industrial sectors. Revenues missed the Zacks Consensus Estimate by 1%.
In the reported quarter, revenues from Asia-Pacific and America declined 14% and 14.4%, respectively. Revenues from Europe, the Middle East and Africa rose 37.1%.
In the fiscal first quarter, Plexus won 30 manufacturing contracts worth $261 million in annualized revenues when fully ramped into production. Trailing four-quarter manufacturing wins totaled more than $1.05 billion in annualized revenues. Plexus also noted that a funnel of qualified manufacturing opportunities now amounted to $4 billion, which increased from $331 million in the fiscal fourth quarter.
Following the announcement, the company’s shares were down 5.2% in the pre-market trading on Jan 25, 2024. The stock has gained 5.2% in the past year compared with the sub-industry’s growth of 40.8%.
Image Source: Zacks Investment Research
Market Sector Details
Industrial revenues were down 7.8% year over year to $435 million, contributing 44% to total revenues.
Healthcare/Life Sciences’ revenues declined 21.9% from the year-ago quarter’s levels to $381 million, contributing 39% to total revenues.
Revenues from Aerospace/Defense increased 24.6% year over year to $167 million, contributing 17% to total revenues.
The company’s top 10 customers accounted for 48% of net revenues in the fiscal first quarter.
Operating Details
Gross profit on a GAAP basis decreased 12.9% year over year to $88.1 million. Gross margin contracted 30 basis points (bps) to 9%.
Selling and administrative expenses decreased 2.1% from the year-ago quarter to $43 million.
PLXS reported an adjusted operating income of $45.1 million, down 21.3% year over year. Adjusted operating margin contracted 60 bps to 4.6%.
Balance Sheet & Cash Flow
As of Dec 30, 2023, Plexus had cash & cash equivalents worth $231.9 million compared with $256.2 million as of Sep 30, 2023.
As of Dec 30, 2023, PLXS had long-term debt and finance lease obligations, net of the current portion of $192.1 million compared with $190.8 million as of Sep 30, 2023.
In the quarter under review, the cash outflow from operations was $3 million. Plexus reported a free cash outflow of $31.7 million.
PLXS did not repurchase shares in the fiscal first quarter. It has shares worth $5.7 million left under its existing $50 million share repurchase authorization.
Guidance
For second-quarter fiscal 2024, revenues are projected to be between $930 million and $970 million.
GAAP operating margin is expected to be between 3% and 3.4%. GAAP diluted EPS is expected to be in the range of 48-63 cents.
Zacks Rank & Stocks to Consider
Plexus currently has a Zacks Rank #5 (Strong Sell).
The Zacks Consensus Estimate for Woodward’s 2023 EPS has inched up 6% in the past 60 days to $4.94. WWD’s long-term earnings growth rate is 15.3%.
Woodward’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average surprise being 14.7%. Shares of WWD have gained 31% in the past year.
The Zacks Consensus Estimate for 2023 is pegged at a loss of 9 cents per share for NETGEAR, which remained unchanged in the past 30 days.
NTGR’s earnings outpaced the Zacks Consensus Estimate in three of the last four quarters while missing once. The average surprise was 127.5%. Shares of NTGR have lost 29.5% in the past year.
The Zacks Consensus Estimate for Watts Water Technologies 2023 EPS has improved 3.9% in the past 60 days to $8.08.
WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have soared 23.2% in the past year.
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Plexus (PLXS) Q1 Earnings & Revenues Miss Estimates, Fall Y/Y
Plexus Corp (PLXS - Free Report) reported first-quarter fiscal 2024 adjusted earnings per share (EPS) of $1.04, which decreased 30.2% year over year. The Zacks Consensus Estimate was pegged at $1.05 per share.
Revenues of $983 million decreased 10.2% year over year. The top-line performance was affected mainly due to weakness in the Healthcare/Life Sciences and Industrial sectors. Revenues missed the Zacks Consensus Estimate by 1%.
In the reported quarter, revenues from Asia-Pacific and America declined 14% and 14.4%, respectively. Revenues from Europe, the Middle East and Africa rose 37.1%.
Plexus Corp. Price, Consensus and EPS Surprise
Plexus Corp. price-consensus-eps-surprise-chart | Plexus Corp. Quote
In the fiscal first quarter, Plexus won 30 manufacturing contracts worth $261 million in annualized revenues when fully ramped into production. Trailing four-quarter manufacturing wins totaled more than $1.05 billion in annualized revenues. Plexus also noted that a funnel of qualified manufacturing opportunities now amounted to $4 billion, which increased from $331 million in the fiscal fourth quarter.
Following the announcement, the company’s shares were down 5.2% in the pre-market trading on Jan 25, 2024. The stock has gained 5.2% in the past year compared with the sub-industry’s growth of 40.8%.
Image Source: Zacks Investment Research
Market Sector Details
Industrial revenues were down 7.8% year over year to $435 million, contributing 44% to total revenues.
Healthcare/Life Sciences’ revenues declined 21.9% from the year-ago quarter’s levels to $381 million, contributing 39% to total revenues.
Revenues from Aerospace/Defense increased 24.6% year over year to $167 million, contributing 17% to total revenues.
The company’s top 10 customers accounted for 48% of net revenues in the fiscal first quarter.
Operating Details
Gross profit on a GAAP basis decreased 12.9% year over year to $88.1 million. Gross margin contracted 30 basis points (bps) to 9%.
Selling and administrative expenses decreased 2.1% from the year-ago quarter to $43 million.
PLXS reported an adjusted operating income of $45.1 million, down 21.3% year over year. Adjusted operating margin contracted 60 bps to 4.6%.
Balance Sheet & Cash Flow
As of Dec 30, 2023, Plexus had cash & cash equivalents worth $231.9 million compared with $256.2 million as of Sep 30, 2023.
As of Dec 30, 2023, PLXS had long-term debt and finance lease obligations, net of the current portion of $192.1 million compared with $190.8 million as of Sep 30, 2023.
In the quarter under review, the cash outflow from operations was $3 million. Plexus reported a free cash outflow of $31.7 million.
PLXS did not repurchase shares in the fiscal first quarter. It has shares worth $5.7 million left under its existing $50 million share repurchase authorization.
Guidance
For second-quarter fiscal 2024, revenues are projected to be between $930 million and $970 million.
GAAP operating margin is expected to be between 3% and 3.4%. GAAP diluted EPS is expected to be in the range of 48-63 cents.
Zacks Rank & Stocks to Consider
Plexus currently has a Zacks Rank #5 (Strong Sell).
Some better-ranked stocks worth considering in the broader technology space are Woodward (WWD - Free Report) , NETGEAR (NTGR - Free Report) and Watts Water Technologies (WTS - Free Report) . NETGEAR and Woodward sport a Zacks Rank #1 (Strong Buy), while Watts Water Technologies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Woodward’s 2023 EPS has inched up 6% in the past 60 days to $4.94. WWD’s long-term earnings growth rate is 15.3%.
Woodward’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average surprise being 14.7%. Shares of WWD have gained 31% in the past year.
The Zacks Consensus Estimate for 2023 is pegged at a loss of 9 cents per share for NETGEAR, which remained unchanged in the past 30 days.
NTGR’s earnings outpaced the Zacks Consensus Estimate in three of the last four quarters while missing once. The average surprise was 127.5%. Shares of NTGR have lost 29.5% in the past year.
The Zacks Consensus Estimate for Watts Water Technologies 2023 EPS has improved 3.9% in the past 60 days to $8.08.
WTS’ earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average surprise being 11.8%. Shares of WTS have soared 23.2% in the past year.