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AAON's Stock Rises on Q4 Earnings Beat, Bookings Up Y/Y
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AAON, Inc. (AAON - Free Report) reported impressive fourth-quarter 2023 results, wherein earnings topped the Zacks Consensus Estimate and grew year over year.
During the quarter, the company reached record net sales on a year-over-year basis thanks to improved productivity and operational efficiencies. The improving trend was reflected in sequentially high bookings resulting in a healthy backlog level. Furthermore, incremental pricing and improved overhead absorption contributed to year-over-year gross margin growth.
Following the announcement, shares of AAON grew 1.4% in the after-hours trading session on Feb 28.
Inside the Numbers
AAON reported quarterly earnings of 56 cents per share, beating the Zacks Consensus Estimate of 53 cents by 5.7%. In the year-ago quarter, the company reported earnings per share of 47 cents.
Quarterly net sales of $306.6 million increased 20.4% from the year-ago level of $254.6 million.
Backlog at the end of fourth-quarter 2023 was $510 million, down 6.9% year over year but up 4% sequentially. The sequential growth was backed by increased bookings.
Operating Highlights
The gross margin expanded 560 basis points (bps) in the fourth quarter to 36.4%. SG&A expenses, as a percentage of sales, increased 310 bps year over year to 15.6% in the quarter.
The operating margin expanded 250 bps year over year in the fourth quarter to 20.8%.
Adjusted EBITDA rose 37.1% to $77 million in the reported period. The adjusted EBITDA margin also increased 300 bps from the prior year to 25.1%.
2023 at a Glance
Net sales grew 31.5% to $1.17 billion compared with $888.8 million reported in the year-ago period. During 2023, AAON’s earnings were $2.13 per share, up 71.8% from the 2022 reported figure of $1.24.
The company’s gross margin notably expanded 740 bps year over year to 34.1%. Also, the operating margin of 19.5% increased 520 bps compared with the year-ago value of 14.3%.
Financial Operations
As of Dec 31, 2023, AAON’s cash and cash equivalents were $0.3 million compared with $5.5 million in 2022 end. For 2023, the net cash provided by operating activities was $158.9 million compared with $61.3 million in the prior year period.
Quanta Services Inc. (PWR - Free Report) reported better-than-expected results for fourth-quarter 2023, wherein adjusted earnings and revenues surpassed the Zacks Consensus Estimate. Both metrics increased on a year-over-year basis.
The company continues to experience high demand for its infrastructure solutions that support energy transition initiatives and increase reliability, safety and efficiency. Project activity associated with renewable generation has been going strong and is expected to continue throughout the year.
Gibraltar Industries, Inc. (ROCK - Free Report) reported fourth-quarter 2023 results, wherein quarterly earnings and net sales missed the Zacks Consensus Estimate. On a year-over-year basis, the top and the bottom lines increased.
The company’s quarterly results reflect organic growth, increased volume, improving customer and product mix, accretive 80/20 initiatives, better price and cost alignment, along with supply-chain optimization initiatives and improvements in project management systems. Gibraltar is optimistic about its growth prospects with its robust end-market fundamentals, backed by increased backlog levels. Supported by solid end market fundamentals, improving business conditions in Renewables and Agtech markets, and an efficient operating engine, ROCK is well-poised to deliver strong results in 2024.
Toll Brothers, Inc. (TOL - Free Report) reported solid results for first-quarter fiscal 2024 (ended Jan 31, 2024), wherein its top and bottom lines surpassed the Zacks Consensus Estimate and increased on a year-over-year basis.
Since mid-January, TOL has experienced a notable surge in demand coinciding with the onset of the spring selling season. Buoyed by a robust job market, improving consumer confidence and sustained low levels of resale inventory, the company maintained an optimistic outlook for strong demand in the new homes market throughout 2024. Following encouraging fiscal first-quarter performance and a robust start to the spring sales season, the company has revised its full-year guidance upward across all key metrics.
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AAON's Stock Rises on Q4 Earnings Beat, Bookings Up Y/Y
AAON, Inc. (AAON - Free Report) reported impressive fourth-quarter 2023 results, wherein earnings topped the Zacks Consensus Estimate and grew year over year.
During the quarter, the company reached record net sales on a year-over-year basis thanks to improved productivity and operational efficiencies. The improving trend was reflected in sequentially high bookings resulting in a healthy backlog level. Furthermore, incremental pricing and improved overhead absorption contributed to year-over-year gross margin growth.
Following the announcement, shares of AAON grew 1.4% in the after-hours trading session on Feb 28.
Inside the Numbers
AAON reported quarterly earnings of 56 cents per share, beating the Zacks Consensus Estimate of 53 cents by 5.7%. In the year-ago quarter, the company reported earnings per share of 47 cents.
AAON, Inc. Price, Consensus and EPS Surprise
AAON, Inc. price-consensus-eps-surprise-chart | AAON, Inc. Quote
Quarterly net sales of $306.6 million increased 20.4% from the year-ago level of $254.6 million.
Backlog at the end of fourth-quarter 2023 was $510 million, down 6.9% year over year but up 4% sequentially. The sequential growth was backed by increased bookings.
Operating Highlights
The gross margin expanded 560 basis points (bps) in the fourth quarter to 36.4%. SG&A expenses, as a percentage of sales, increased 310 bps year over year to 15.6% in the quarter.
The operating margin expanded 250 bps year over year in the fourth quarter to 20.8%.
Adjusted EBITDA rose 37.1% to $77 million in the reported period. The adjusted EBITDA margin also increased 300 bps from the prior year to 25.1%.
2023 at a Glance
Net sales grew 31.5% to $1.17 billion compared with $888.8 million reported in the year-ago period. During 2023, AAON’s earnings were $2.13 per share, up 71.8% from the 2022 reported figure of $1.24.
The company’s gross margin notably expanded 740 bps year over year to 34.1%. Also, the operating margin of 19.5% increased 520 bps compared with the year-ago value of 14.3%.
Financial Operations
As of Dec 31, 2023, AAON’s cash and cash equivalents were $0.3 million compared with $5.5 million in 2022 end. For 2023, the net cash provided by operating activities was $158.9 million compared with $61.3 million in the prior year period.
Zacks Rank & Recent Construction Releases
AAON currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quanta Services Inc. (PWR - Free Report) reported better-than-expected results for fourth-quarter 2023, wherein adjusted earnings and revenues surpassed the Zacks Consensus Estimate. Both metrics increased on a year-over-year basis.
The company continues to experience high demand for its infrastructure solutions that support energy transition initiatives and increase reliability, safety and efficiency. Project activity associated with renewable generation has been going strong and is expected to continue throughout the year.
Gibraltar Industries, Inc. (ROCK - Free Report) reported fourth-quarter 2023 results, wherein quarterly earnings and net sales missed the Zacks Consensus Estimate. On a year-over-year basis, the top and the bottom lines increased.
The company’s quarterly results reflect organic growth, increased volume, improving customer and product mix, accretive 80/20 initiatives, better price and cost alignment, along with supply-chain optimization initiatives and improvements in project management systems. Gibraltar is optimistic about its growth prospects with its robust end-market fundamentals, backed by increased backlog levels. Supported by solid end market fundamentals, improving business conditions in Renewables and Agtech markets, and an efficient operating engine, ROCK is well-poised to deliver strong results in 2024.
Toll Brothers, Inc. (TOL - Free Report) reported solid results for first-quarter fiscal 2024 (ended Jan 31, 2024), wherein its top and bottom lines surpassed the Zacks Consensus Estimate and increased on a year-over-year basis.
Since mid-January, TOL has experienced a notable surge in demand coinciding with the onset of the spring selling season. Buoyed by a robust job market, improving consumer confidence and sustained low levels of resale inventory, the company maintained an optimistic outlook for strong demand in the new homes market throughout 2024. Following encouraging fiscal first-quarter performance and a robust start to the spring sales season, the company has revised its full-year guidance upward across all key metrics.