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Johnson Controls (JCI) Q1 Earnings Beat, Revenues Rise Y/Y
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Johnson Controls International plc (JCI - Free Report) reported first-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings of 51 cents per share, which beat the Zacks Consensus Estimate for earnings of 50 cents per share. However, the bottom line decreased 23.9% year over year.
Total revenues of $6,094 million missed the consensus estimate of $6,126 million. The top line increased 0.4% year over year.
Segmental Results
Building Solutions North America: The segment’s revenues were $2,487 million, up 5% year over year. Our estimate for Building Solutions North America revenues for the fiscal first quarter was $2,528.0 million. Organic sales jumped 4%, driven by the strong performance of applied heating, ventilation and air conditioning (HVAC) & controls business. The segment’s EBITA increased 7% year over year to $285 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues from this segment totaled $1,038 million, up 6% year over year. Our estimate for Building Solutions Europe, Middle East, Africa/Latin America revenues for the fiscal first quarter was $1,048.1 million. Organic sales climbed 2% due to growth in service, HVAC & controls, fire & security businesses. The segment’s EBITA was $80 million, up 7% from the year-ago period.
Building Solutions Asia Pacific: Revenues decreased 22% to $507 million in the reported quarter. Sales declined 21% organically due to weakness in the China region. The segment’s EBITA was $46 million, down 32% year over year.
Global Products: Revenues in this segment declined 1% year over year to $2,062 million. Our estimate for Global Products revenues in the fiscal first quarter was $1,970.8 million. Organic sales were down 1% due to a decline in the global Residential HVAC business. The segment’s EBITA was $369 million, down 3% year over year.
Johnson Controls International plc Price, Consensus and EPS Surprise
Johnson Controls had cash and cash equivalents of $1,801 million as of Dec 31, 2023 compared with $835 million at the end of fiscal 2023. Long-term debt was $7,959 million compared with $7,818 million at the end of fiscal 2023.
The company reported a free cash outflow of $338 million in the first three months of fiscal 2024 compared with $430 million cash outflow in the year-ago period.
The company did not repurchase any shares in the first quarter of fiscal 2024.
Fiscal Q2 Guidance
For the second quarter of fiscal 2024, Johnson Controls anticipates organic revenue growth to be flat year over year. The segment EBITA margin is estimated to be approximately 14.5%. The company expects adjusted earnings to be 74-78 cents per share in the fiscal second quarter. The mid-point of the guided range — 76 cents per share — lies below the Zacks Consensus Estimate for earnings of 77 cents per share.
FY24 Guidance
Johnson Controls anticipates year-over-year organic revenue growth to be in the mid-single digits in fiscal 2024. The adjusted segment EBITA margin is expected to improve 50-75 bps year over year.
JCI expects adjusted earnings to be approximately $3.60-$3.75 per share in fiscal 2024 compared with earnings of $3.65-$3.80 per share predicted earlier. The mid-point of the guided range — $3.67 per share — lies above the Zacks Consensus Estimate for earnings of $3.66 per share.
Zacks Rank & Stocks to Consider
JCI currently carries Zacks Rank #4 (Sell). Some better-ranked companies from the Industrial Products sector are discussed below:
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has remained steady. The stock has risen 19.5% in the past year.
A. O. Smith Corporation (AOS - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 14%.
The Zacks Consensus Estimate for AOS’ 2023 earnings increased 0.8% in the past 60 days. Shares of A. O. Smith have jumped 20.6% in the past year.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has increased 0.2%. The stock has risen 43.8% in the past year.
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Johnson Controls (JCI) Q1 Earnings Beat, Revenues Rise Y/Y
Johnson Controls International plc (JCI - Free Report) reported first-quarter fiscal 2024 (ended Dec 31, 2023) adjusted earnings of 51 cents per share, which beat the Zacks Consensus Estimate for earnings of 50 cents per share. However, the bottom line decreased 23.9% year over year.
Total revenues of $6,094 million missed the consensus estimate of $6,126 million. The top line increased 0.4% year over year.
Segmental Results
Building Solutions North America: The segment’s revenues were $2,487 million, up 5% year over year. Our estimate for Building Solutions North America revenues for the fiscal first quarter was $2,528.0 million. Organic sales jumped 4%, driven by the strong performance of applied heating, ventilation and air conditioning (HVAC) & controls business. The segment’s EBITA increased 7% year over year to $285 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues from this segment totaled $1,038 million, up 6% year over year. Our estimate for Building Solutions Europe, Middle East, Africa/Latin America revenues for the fiscal first quarter was $1,048.1 million. Organic sales climbed 2% due to growth in service, HVAC & controls, fire & security businesses. The segment’s EBITA was $80 million, up 7% from the year-ago period.
Building Solutions Asia Pacific: Revenues decreased 22% to $507 million in the reported quarter. Sales declined 21% organically due to weakness in the China region. The segment’s EBITA was $46 million, down 32% year over year.
Global Products: Revenues in this segment declined 1% year over year to $2,062 million. Our estimate for Global Products revenues in the fiscal first quarter was $1,970.8 million. Organic sales were down 1% due to a decline in the global Residential HVAC business. The segment’s EBITA was $369 million, down 3% year over year.
Johnson Controls International plc Price, Consensus and EPS Surprise
Johnson Controls International plc price-consensus-eps-surprise-chart | Johnson Controls International plc Quote
Financial Position
Johnson Controls had cash and cash equivalents of $1,801 million as of Dec 31, 2023 compared with $835 million at the end of fiscal 2023. Long-term debt was $7,959 million compared with $7,818 million at the end of fiscal 2023.
The company reported a free cash outflow of $338 million in the first three months of fiscal 2024 compared with $430 million cash outflow in the year-ago period.
The company did not repurchase any shares in the first quarter of fiscal 2024.
Fiscal Q2 Guidance
For the second quarter of fiscal 2024, Johnson Controls anticipates organic revenue growth to be flat year over year. The segment EBITA margin is estimated to be approximately 14.5%. The company expects adjusted earnings to be 74-78 cents per share in the fiscal second quarter. The mid-point of the guided range — 76 cents per share — lies below the Zacks Consensus Estimate for earnings of 77 cents per share.
FY24 Guidance
Johnson Controls anticipates year-over-year organic revenue growth to be in the mid-single digits in fiscal 2024. The adjusted segment EBITA margin is expected to improve 50-75 bps year over year.
JCI expects adjusted earnings to be approximately $3.60-$3.75 per share in fiscal 2024 compared with earnings of $3.65-$3.80 per share predicted earlier. The mid-point of the guided range — $3.67 per share — lies above the Zacks Consensus Estimate for earnings of $3.66 per share.
Zacks Rank & Stocks to Consider
JCI currently carries Zacks Rank #4 (Sell). Some better-ranked companies from the Industrial Products sector are discussed below:
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has remained steady. The stock has risen 19.5% in the past year.
A. O. Smith Corporation (AOS - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 14%.
The Zacks Consensus Estimate for AOS’ 2023 earnings increased 0.8% in the past 60 days. Shares of A. O. Smith have jumped 20.6% in the past year.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has increased 0.2%. The stock has risen 43.8% in the past year.