We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Beacon Roofing Supply, Inc. (BECN - Free Report) reported lower-than-expected third-quarter 2024 results, with earnings and net sales missing the Zacks Consensus Estimate. The top line grew, while the bottom line declined year over year.
See the Zacks Earnings Calendar to stay ahead of market-making news.
The year-over-year growth in the top line was backed by continued benefits realized from greenfield locations and acquired branches, along with strong demand trends for non-discretionary repair and reroofing. During the quarter, BECN added four greenfield locations in key markets, thereby boosting organic growth. Although softness in the overall activity level was a headwind, favorable price-cost across all lines of business driven by disciplined margin management aided the quarter’s results.
Going forward, the company aims to focus on accretive acquisitions, especially enhancing its non-residential and Canadian footprints to foster growth in the upcoming period and achieve its Ambition 2025 goals.
BECN stock lost 0.6% in the after-hours trading session on Thursday. The investors’ sentiments are likely to have been hurt due to the downward revision of the adjusted EBITDA (earnings before interest, tax, depreciation and amortization) outlook for 2024.
Beacon’s Earnings & Sales Discussion
Adjusted earnings per share of $2.80 missed the Zacks Consensus Estimate of $2.88 by 2.8% and plunged 1.8% from the year-ago adjusted level of $2.85.
Net sales of $2.77 billion also marginally missed the consensus mark of $2.78 billion by 0.2%. However, the top line increased 7.3% on a year-over-year basis.
Beacon Roofing Supply, Inc. Price, Consensus and EPS Surprise
Estimated organic volumes, which encompass greenfield projects, experienced a slight increase of 0-1%, while the weighted average selling price saw a rise of 1-2%. The inclusion of acquired branches accounted for 5.2% of the overall net sales.
Sales According to BECN’s Line of Business
Residential Roofing Products: Sales of this product line (comprising 50.7% of quarterly net sales) were $1.405 billion, up 2.3% from the year-ago quarter’s (well below our expectation of 6.6% growth) tally. The upside was primarily driven by price execution.
Non-Residential Roofing Products: Sales (comprising 26.7% of quarterly net sales) rose 9.4% from the year-ago quarter’s figure to $739 million owing to higher volumes driven by strong underlying market demand and solid market execution. Our model had predicted this business line’s sales to grow 13.4%.
Complementary Building Products: Sales of this product line (comprising 22.6% of quarterly net sales) increased 17.2% year over year (above our expectation of 11.6% growth) to $628.7 million. The rise in sales primarily stemmed from three waterproofing acquisitions totaling 20 branches since Sept. 30, 2023.
Operating Highlights of BECN
The gross margin of 26.3% was up 30 basis points (bps) year over year. The upside can be attributed to increased average selling prices, which offset higher product costs and non-residential product mix.
Adjusted EBITDA increased year over year to $325.2 million from $309.6. Yet, the adjusted EBITDA margin contracted 30 bps year over year to 11.7%.
Beacon’s Other Financial Details
As of Sept. 30, 2024, the company had cash and cash equivalents of $68 million, down from $84 million at 2023-end. Net long-term debt was $2.48 billion, up from the 2023-end value of $2.19 billion.
Net cash used in operating activities was $59.6 million in the first nine months of 2024 against $525.7 million cash provided by operating activities in the prior year.
BECN’s Revised Guidance
For the fourth quarter of 2024, Beacon anticipates net sales per day to be up in the mid-single digits from the year-ago period’s figure. The gross margin is expected to be in the mid-25% range compared with 25.7% a year ago. Net sales per day for October 2024 were up approximately 6% year over year.
Adjusted EBITDA is now expected to be in the range of $930-$950 million compared with earlier expectations of $930-$970 million.
The company now expects about 20 new greenfield locations in 2024 compared with prior expectations of 25 new locations.
Despite lower storm volume projections and the impact of higher interest rates on housing, Beacon remains optimistic about sustained demand for non-discretionary repair and re-roofing along with stable non-residential market demand.
Shake Shack Inc. (SHAK - Free Report) posted third-quarter fiscal 2024 results, wherein both earnings and revenues beat the respective Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis.
In the quarter, the company ramped up its investment in marketing strategies and programs aimed at increasing guest engagement and brand awareness, even amid a challenging market environment. These efforts have paid off as it has achieved some of the highest brand awareness levels on record, which, in turn, are fueling robust sales and profitability growth.
Starbucks Corporation (SBUX - Free Report) reported fourth-quarter fiscal 2024 results, with earnings meeting the Zacks Consensus Estimate but revenues missing the same. The bottom and top lines declined year over year.
Global comparable store sales declined 7% year over year. The downside was backed by a decrease of 8% in comparable transactions, partially overshadowed by a 2% increase in average tickets. During the quarter, SBUX opened 722 net new stores worldwide, bringing the total store count to 40,199.
Brinker International, Inc. (EAT - Free Report) reported first-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines increased from the prior-year figures.
EAT gained from the solid performance of Chili's. The upside was backed by favorable comparable restaurant sales driven by menu pricing, higher traffic and a favorable menu item mix. The segment’s company-owned comps rose 14.1% from the year-ago quarter’s level. The company projects fiscal 2025 earnings per share to be in the range of $5.2-$5.5, up from the prior estimate of $4.35-$4.75.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Beacon Q3 Earnings & Sales Miss, '24 Adjusted EBITDA View Down
Beacon Roofing Supply, Inc. (BECN - Free Report) reported lower-than-expected third-quarter 2024 results, with earnings and net sales missing the Zacks Consensus Estimate. The top line grew, while the bottom line declined year over year.
See the Zacks Earnings Calendar to stay ahead of market-making news.
The year-over-year growth in the top line was backed by continued benefits realized from greenfield locations and acquired branches, along with strong demand trends for non-discretionary repair and reroofing. During the quarter, BECN added four greenfield locations in key markets, thereby boosting organic growth. Although softness in the overall activity level was a headwind, favorable price-cost across all lines of business driven by disciplined margin management aided the quarter’s results.
Going forward, the company aims to focus on accretive acquisitions, especially enhancing its non-residential and Canadian footprints to foster growth in the upcoming period and achieve its Ambition 2025 goals.
BECN stock lost 0.6% in the after-hours trading session on Thursday. The investors’ sentiments are likely to have been hurt due to the downward revision of the adjusted EBITDA (earnings before interest, tax, depreciation and amortization) outlook for 2024.
Beacon’s Earnings & Sales Discussion
Adjusted earnings per share of $2.80 missed the Zacks Consensus Estimate of $2.88 by 2.8% and plunged 1.8% from the year-ago adjusted level of $2.85.
Net sales of $2.77 billion also marginally missed the consensus mark of $2.78 billion by 0.2%. However, the top line increased 7.3% on a year-over-year basis.
Beacon Roofing Supply, Inc. Price, Consensus and EPS Surprise
Beacon Roofing Supply, Inc. price-consensus-eps-surprise-chart | Beacon Roofing Supply, Inc. Quote
Estimated organic volumes, which encompass greenfield projects, experienced a slight increase of 0-1%, while the weighted average selling price saw a rise of 1-2%. The inclusion of acquired branches accounted for 5.2% of the overall net sales.
Sales According to BECN’s Line of Business
Residential Roofing Products: Sales of this product line (comprising 50.7% of quarterly net sales) were $1.405 billion, up 2.3% from the year-ago quarter’s (well below our expectation of 6.6% growth) tally. The upside was primarily driven by price execution.
Non-Residential Roofing Products: Sales (comprising 26.7% of quarterly net sales) rose 9.4% from the year-ago quarter’s figure to $739 million owing to higher volumes driven by strong underlying market demand and solid market execution. Our model had predicted this business line’s sales to grow 13.4%.
Complementary Building Products: Sales of this product line (comprising 22.6% of quarterly net sales) increased 17.2% year over year (above our expectation of 11.6% growth) to $628.7 million. The rise in sales primarily stemmed from three waterproofing acquisitions totaling 20 branches since Sept. 30, 2023.
Operating Highlights of BECN
The gross margin of 26.3% was up 30 basis points (bps) year over year. The upside can be attributed to increased average selling prices, which offset higher product costs and non-residential product mix.
Adjusted EBITDA increased year over year to $325.2 million from $309.6. Yet, the adjusted EBITDA margin contracted 30 bps year over year to 11.7%.
Beacon’s Other Financial Details
As of Sept. 30, 2024, the company had cash and cash equivalents of $68 million, down from $84 million at 2023-end. Net long-term debt was $2.48 billion, up from the 2023-end value of $2.19 billion.
Net cash used in operating activities was $59.6 million in the first nine months of 2024 against $525.7 million cash provided by operating activities in the prior year.
BECN’s Revised Guidance
For the fourth quarter of 2024, Beacon anticipates net sales per day to be up in the mid-single digits from the year-ago period’s figure. The gross margin is expected to be in the mid-25% range compared with 25.7% a year ago. Net sales per day for October 2024 were up approximately 6% year over year.
Adjusted EBITDA is now expected to be in the range of $930-$950 million compared with earlier expectations of $930-$970 million.
The company now expects about 20 new greenfield locations in 2024 compared with prior expectations of 25 new locations.
Despite lower storm volume projections and the impact of higher interest rates on housing, Beacon remains optimistic about sustained demand for non-discretionary repair and re-roofing along with stable non-residential market demand.
BECN’s Zacks Rank & Recent Retail-Wholesale Releases
Beacon currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
Shake Shack Inc. (SHAK - Free Report) posted third-quarter fiscal 2024 results, wherein both earnings and revenues beat the respective Zacks Consensus Estimate. The top and bottom lines also increased on a year-over-year basis.
In the quarter, the company ramped up its investment in marketing strategies and programs aimed at increasing guest engagement and brand awareness, even amid a challenging market environment. These efforts have paid off as it has achieved some of the highest brand awareness levels on record, which, in turn, are fueling robust sales and profitability growth.
Starbucks Corporation (SBUX - Free Report) reported fourth-quarter fiscal 2024 results, with earnings meeting the Zacks Consensus Estimate but revenues missing the same. The bottom and top lines declined year over year.
Global comparable store sales declined 7% year over year. The downside was backed by a decrease of 8% in comparable transactions, partially overshadowed by a 2% increase in average tickets. During the quarter, SBUX opened 722 net new stores worldwide, bringing the total store count to 40,199.
Brinker International, Inc. (EAT - Free Report) reported first-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines increased from the prior-year figures.
EAT gained from the solid performance of Chili's. The upside was backed by favorable comparable restaurant sales driven by menu pricing, higher traffic and a favorable menu item mix. The segment’s company-owned comps rose 14.1% from the year-ago quarter’s level. The company projects fiscal 2025 earnings per share to be in the range of $5.2-$5.5, up from the prior estimate of $4.35-$4.75.