Stanley Black & Decker, Inc. (SWK Quick QuoteSWK - Free Report) reported first-quarter 2024 adjusted earnings of 56 cents per share, which beat the Zacks Consensus Estimate of 55 cents. The company reported a loss of 41 cents per share in the year-ago quarter.

Stanley Black’s net sales of $3.9 billion beat the consensus estimate of $3.8 billion. The top line declined 1.6% year over year due to weakness in the Tools & Outdoor segment.

Segmental Discussion

Revenues from SWK’s primary segment, Tools & Outdoor, totaled $3.3 billion, down approximately 1% year over year. Muted market demand weighed on segmental revenues. Our estimate for segmental revenues was $3.3 billion.

Revenues from the Industrial segment grossed $584.9 million, down 5.1% year over year. Lower volumes in the infrastructure market hurt segmental revenues. Our estimate for segmental revenues was $549.2 million.

Margin Profile

Stanley Black’s cost of sales decreased 10.8% year over year to $2.8 billion. The gross profit increased 32.7% year over year to $1.1 billion. The gross margin increased 740 basis points (bps) year over year to 28.6%.

Selling, general and administrative expenses increased 3.2% year over year to $851.8 million. Adjusted EBITDA was $342.6 million, reflecting year-over-year growth of 93%. The margin increased 440 bps to 8.9%.

Balance Sheet and Cash Flow

While exiting the first quarter, Stanley Black had cash and cash equivalents of $476.6 million compared with $449.4 million reported at the end of fourth-quarter 2023. The long-term debt balance was $5.6 billion, higher than $6.1 billion reported at the end of fourth-quarter 2023.

In the first three months of 2024, net cash used in operating activities was $431 million compared with $286.3 million cash used in the year-ago period. Capital and software expenditures totaled $65.7 million, down from $68.2 million reported in the year-ago period. Free cash outflow (before dividends) in the year was $496.7 million compared with $354.5 billion free cash outflow a year ago.

In the first three months of 2024, SWK, carrying a current Zacks Rank #3 (Hold), paid out dividends worth $121.8 million to its shareholders, up 1.7% from the year-ago period. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

2024 Guidance

For 2024, Stanley Black expects adjusted earnings of $3.50-$4.50 per share. The company anticipates earnings of $1.60-$2.85 per share in the year

Stanley Black expects a free cash flow of $0.6-$0.8 billion for 2024.

Performance of Other Industrial Companies

IDEX Corporation’s (IEX Quick QuoteIEX - Free Report) second-quarter fiscal 2024 adjusted earnings of $1.88 per share surpassed the Zacks Consensus Estimate of $1.75. On a year-over-year basis, the bottom line decreased approximately 10.1%.

IDEX’s net sales of $800.5 million underperformed the consensus estimate of $805 million. The top line also decreased 5.3% year over year.

A. O. Smith Corporation’s (AOS Quick QuoteAOS - Free Report) second-quarter fiscal 2024 adjusted earnings of $1.00 per share surpassed the Zacks Consensus Estimate of 99 cents. The bottom line increased 6% on a year-over-year basis.

Net sales of $978.8 million missed the consensus estimate of $995 million. However, the top line inched up 1% year over year, driven by strong demand for commercial water heaters in North America.

W.W. Grainger, Inc. (GWW Quick QuoteGWW - Free Report) has reported earnings per share of $9.62 in second-quarter fiscal 2024, beating the Zacks Consensus Estimate of $9.58. The bottom line improved 0.1% year over year.

Grainger’s quarterly revenues rose 3.5% year over year to $4.24 billion. The top line missed the consensus estimate of $4.27 billion.