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Why Is Phibro (PAHC) Up 12.7% Since Last Earnings Report?
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A month has gone by since the last earnings report for Phibro Animal Health (PAHC - Free Report) . Shares have added about 12.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Phibro 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.
Phibro Q2 Earnings Surpass Estimates, Margins Fall
Phibro Animal Healthdelivered adjusted earnings per share of 33 cents in the second quarter of fiscal 2024, down 2.9% from the year-ago quarter’s adjusted figure. However, the metric beat the Zacks Consensus Estimate by 22.2%.
Without adjustments, the GAAP earnings per share in the fiscal second quarter was 3 cents compared with 18 cents in the year-ago quarter.
Net Sales
In the quarter under review, net sales totaled $249.9 million, a 2.2% increase from the year-ago quarter. The figure also topped the Zacks Consensus Estimate by 2.9%.
Segmental Sales Breakup
The company conducts its operations via three segments — Animal Health, Mineral Nutrition and Performance Products.
In the second quarter of fiscal 2024, Animal Health’s net sales increased 5.7% to $173.1 million. The figure surpassed our model’s projected revenues of $161 million.
Within the segment, net sales of medicated feed additives (MFAs) and others reflected 4.8% year-over-year growth. The uptick was driven by the increased demand for MFAs in the international regions and processing aids used in the ethanol fermentation industry.
Within Animal Health, nutritional specialty product sales decreased 6%, primarily due to lower domestic dairy demand. However, net vaccine sales showed a year-over-year rise of 31%, mostly due to poultry product introductions in Latin America, along with an increase in domestic demand.
Net sales in the Mineral Nutrition segment fell 0.5% year over year to $61.3 million due to declines in average selling prices and some reduction in sales volumes. Our model projected the segment’s revenues to be $62.5 million.
Net sales in the Performance Products segment fell 19.3% to $15.5 million as a result of the decreased demand for personal care product ingredients and industrial chemicals. Our model projected the segment to report $16.9 million in revenues.
Margins
Phibro’s fiscal second-quarter gross profit rose 1.7% year over year to $78.6 million. However, the gross margin contracted 15 basis points (bps) to 31.5% on a 2.4% rise in the cost of goods sold.
SG&A expenses in the reported quarter were $62.9 million, up 2.3% from the year-ago quarter’s levels. The operating profit fell 0.6% year over year to $15.7 million, while the operating margin contracted 18 bps to 6.3% in the quarter under review.
Financial Update
The company exited the second quarter of fiscal 2024 with cash and short-term investments of $92.5 million compared with $91.2 million at the end of the fiscal first quarter.
Cumulative net cash provided by operating activities at the end of the second quarter was $47.8 million compared with $16.2 million at the end of the first quarter.
Guidance
Phibro reaffirmed its outlook for fiscal 2024.
The company expects net sales between $980 million and $1.02 billion (unchanged). The Zacks Consensus Estimate for the metric is pegged at $979.8 million.
Adjusted earnings per share is expected in the range of $1.04-$1.16 (unchanged). The Zacks Consensus Estimate is pegged at $1.07.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
At this time, Phibro has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. 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 trending upward for the stock, and the magnitude of this revision has been net zero. It comes with little surprise Phibro has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Phibro belongs to the Zacks Medical - Products industry. Another stock from the same industry, Stryker (SYK - Free Report) , has gained 5.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Stryker reported revenues of $5.82 billion in the last reported quarter, representing a year-over-year change of +11.8%. EPS of $3.46 for the same period compares with $3 a year ago.
For the current quarter, Stryker is expected to post earnings of $2.35 per share, indicating a change of +9.8% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
Stryker has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.
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Why Is Phibro (PAHC) Up 12.7% Since Last Earnings Report?
A month has gone by since the last earnings report for Phibro Animal Health (PAHC - Free Report) . Shares have added about 12.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Phibro 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.
Phibro Q2 Earnings Surpass Estimates, Margins Fall
Phibro Animal Health delivered adjusted earnings per share of 33 cents in the second quarter of fiscal 2024, down 2.9% from the year-ago quarter’s adjusted figure. However, the metric beat the Zacks Consensus Estimate by 22.2%.
Without adjustments, the GAAP earnings per share in the fiscal second quarter was 3 cents compared with 18 cents in the year-ago quarter.
Net Sales
In the quarter under review, net sales totaled $249.9 million, a 2.2% increase from the year-ago quarter. The figure also topped the Zacks Consensus Estimate by 2.9%.
Segmental Sales Breakup
The company conducts its operations via three segments — Animal Health, Mineral Nutrition and Performance Products.
In the second quarter of fiscal 2024, Animal Health’s net sales increased 5.7% to $173.1 million. The figure surpassed our model’s projected revenues of $161 million.
Within the segment, net sales of medicated feed additives (MFAs) and others reflected 4.8% year-over-year growth. The uptick was driven by the increased demand for MFAs in the international regions and processing aids used in the ethanol fermentation industry.
Within Animal Health, nutritional specialty product sales decreased 6%, primarily due to lower domestic dairy demand. However, net vaccine sales showed a year-over-year rise of 31%, mostly due to poultry product introductions in Latin America, along with an increase in domestic demand.
Net sales in the Mineral Nutrition segment fell 0.5% year over year to $61.3 million due to declines in average selling prices and some reduction in sales volumes. Our model projected the segment’s revenues to be $62.5 million.
Net sales in the Performance Products segment fell 19.3% to $15.5 million as a result of the decreased demand for personal care product ingredients and industrial chemicals. Our model projected the segment to report $16.9 million in revenues.
Margins
Phibro’s fiscal second-quarter gross profit rose 1.7% year over year to $78.6 million. However, the gross margin contracted 15 basis points (bps) to 31.5% on a 2.4% rise in the cost of goods sold.
SG&A expenses in the reported quarter were $62.9 million, up 2.3% from the year-ago quarter’s levels. The operating profit fell 0.6% year over year to $15.7 million, while the operating margin contracted 18 bps to 6.3% in the quarter under review.
Financial Update
The company exited the second quarter of fiscal 2024 with cash and short-term investments of $92.5 million compared with $91.2 million at the end of the fiscal first quarter.
Cumulative net cash provided by operating activities at the end of the second quarter was $47.8 million compared with $16.2 million at the end of the first quarter.
Guidance
Phibro reaffirmed its outlook for fiscal 2024.
The company expects net sales between $980 million and $1.02 billion (unchanged). The Zacks Consensus Estimate for the metric is pegged at $979.8 million.
Adjusted earnings per share is expected in the range of $1.04-$1.16 (unchanged). The Zacks Consensus Estimate is pegged at $1.07.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month.
VGM Scores
At this time, Phibro has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. 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 trending upward for the stock, and the magnitude of this revision has been net zero. It comes with little surprise Phibro has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
Phibro belongs to the Zacks Medical - Products industry. Another stock from the same industry, Stryker (SYK - Free Report) , has gained 5.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
Stryker reported revenues of $5.82 billion in the last reported quarter, representing a year-over-year change of +11.8%. EPS of $3.46 for the same period compares with $3 a year ago.
For the current quarter, Stryker is expected to post earnings of $2.35 per share, indicating a change of +9.8% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
Stryker has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.