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Why Is Valmont (VMI) Up 0.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Valmont Industries (VMI - Free Report) . Shares have added about 0.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Valmont due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Valmont's Q4 Earnings Beat Estimates, Revenues Miss
Valmont reported fourth-quarter 2023 adjusted earnings per share of $3.18, down from $3.57 in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of $3.08.
The company expanded gross profit margins in the reported quarter, thanks to its pricing strategies and operational efficiencies, notwithstanding lower volumes.
The company’s revenues were $1,015.5 million in the quarter, down 10.3% year over year.. The top line missed the Zacks Consensus Estimate of $1,037.6 million.
Segment Review
The Infrastructure segment’s fourth-quarter revenues decreased 3% year over year to $748.3 million. The figure topped our estimate of $714.2 million. Higher volumes in the Transmission, Distribution and Substation and Solar product lines and favorable pricing were more than offset by lower Telecommunications and Coatings volumes.
Revenues from the Agriculture segment totaled $271.6 million, which decreased 18.9% year over year. The figure missed our estimate of $320.6 million. In North America, irrigation equipment volumes fell as the fourth quarter of 2022 benefited from the continued delivery of an elevated backlog. The average irrigation selling price was comparable to the previous year.
Financials
The company achieved $210 million in free cash flow for 2023 through earnings and sound working capital management. At the end of 2023, cash and cash equivalents were $203 million.
The fourth quarter saw the purchase of $178.6 million in company stock, which included the $120 million Accelerated Share Repurchase program. Valmont had $136.1 million remaining on the authorized share repurchase program at the end of the year.
Outlook
For 2024, Valmont anticipates a net sales change of -3% to flat. It expects EPS of $14.25-$15.5. It also anticipates capital expenditures in the $125-$140 million range for 2024. Effective tax rate is assumed to be 26%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -5.12% due to these changes.
VGM Scores
At this time, Valmont has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Valmont has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Valmont belongs to the Zacks Steel - Pipe and Tube industry. Another stock from the same industry, MRC Global (MRC - Free Report) , has gained 7.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
MRC reported revenues of $768 million in the last reported quarter, representing a year-over-year change of -11.6%. EPS of $0.23 for the same period compares with $0.32 a year ago.
MRC is expected to post earnings of $0.11 per share for the current quarter, representing a year-over-year change of -65.6%. Over the last 30 days, the Zacks Consensus Estimate has changed -35.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #5 (Strong Sell) for MRC. Also, the stock has a VGM Score of A.
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Why Is Valmont (VMI) Up 0.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Valmont Industries (VMI - Free Report) . Shares have added about 0.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Valmont due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Valmont's Q4 Earnings Beat Estimates, Revenues Miss
Valmont reported fourth-quarter 2023 adjusted earnings per share of $3.18, down from $3.57 in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of $3.08.
The company expanded gross profit margins in the reported quarter, thanks to its pricing strategies and operational efficiencies, notwithstanding lower volumes.
The company’s revenues were $1,015.5 million in the quarter, down 10.3% year over year.. The top line missed the Zacks Consensus Estimate of $1,037.6 million.
Segment Review
The Infrastructure segment’s fourth-quarter revenues decreased 3% year over year to $748.3 million. The figure topped our estimate of $714.2 million. Higher volumes in the Transmission, Distribution and Substation and Solar product lines and favorable pricing were more than offset by lower Telecommunications and Coatings volumes.
Revenues from the Agriculture segment totaled $271.6 million, which decreased 18.9% year over year. The figure missed our estimate of $320.6 million. In North America, irrigation equipment volumes fell as the fourth quarter of 2022 benefited from the continued delivery of an elevated backlog. The average irrigation selling price was comparable to the previous year.
Financials
The company achieved $210 million in free cash flow for 2023 through earnings and sound working capital management. At the end of 2023, cash and cash equivalents were $203 million.
The fourth quarter saw the purchase of $178.6 million in company stock, which included the $120 million Accelerated Share Repurchase program. Valmont had $136.1 million remaining on the authorized share repurchase program at the end of the year.
Outlook
For 2024, Valmont anticipates a net sales change of -3% to flat. It expects EPS of $14.25-$15.5. It also anticipates capital expenditures in the $125-$140 million range for 2024. Effective tax rate is assumed to be 26%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -5.12% due to these changes.
VGM Scores
At this time, Valmont has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Valmont has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Valmont belongs to the Zacks Steel - Pipe and Tube industry. Another stock from the same industry, MRC Global (MRC - Free Report) , has gained 7.8% over the past month. More than a month has passed since the company reported results for the quarter ended December 2023.
MRC reported revenues of $768 million in the last reported quarter, representing a year-over-year change of -11.6%. EPS of $0.23 for the same period compares with $0.32 a year ago.
MRC is expected to post earnings of $0.11 per share for the current quarter, representing a year-over-year change of -65.6%. Over the last 30 days, the Zacks Consensus Estimate has changed -35.3%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #5 (Strong Sell) for MRC. Also, the stock has a VGM Score of A.