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AptarGroup (ATR) Up 7.2% Since Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for AptarGroup, Inc. (ATR - Free Report) . Shares have added about 7.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it 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 catalysts.
AptarGroup Beats on Q1 Earnings and Revenues
AptarGroup reported first-quarter 2017 earnings per share of $0.77, up 4% year over year. Earnings also beat the Zacks Consensus Estimate of $0.75. Earnings came at the higher end of the company’s guidance range of $0.72–$0.77 per share. On a reported basis, earnings per share increased 21% to $0.81 from $0.67 in the prior-year quarter.
Operational Update
Total revenue was up 3.3% year over year to $601 million in the reported quarter, surpassing the Zacks Consensus Estimate of $591 million. Excluding the negative impact from changes in currency exchange rates and the positive impact from acquisitions, core sales increased by 3%.
Cost of sales increased to $385 million from $374 million in the year-ago quarter. Gross profit improved 4% year over year to $385 million with gross margin expanding 30 basis points (bps) to 36%. Selling, research, development and administrative expenses went down 1% year over year to $101.5 million. Adjusted operating income increased 16% year over year to $69.5 million. AptarGroup’s operating margin expanded 130 bps year over year to 11.6%.
Segmental Performance
Total revenue in the Beauty and Homes segment went up 2.8% year over year to $322 million. Operating income decreased 6% to $22 million from $23.5 million in the year-ago quarter.
Total revenue in the Pharma segment went up 7.5% year over year to $197 million. Operating income grew 11% year over year to $59 million in the quarter.
Total revenue in the Food and Beverage segment dipped 3% year over year to $81.9 million. Operating income declined 23% year over year to $7.14 million.
Financial Performance
AptarGroup reported cash and cash equivalents of $284.7 million at the end of the first quarter, down from $466 million as of Dec 31, 2016. At the quarter end, long-term debt was approximately $771.3 million, down from $773 million as of Dec 31, 2016.
Outlook
For second-quarter 2017, AptarGroup expects earnings to be in the range of $0.92–$0.97. Comparable earnings per share for the prior year quarter were approximately $0.87.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter
At this time, the stock has a Growth Score of 'C', though it is lagging a bit on the momentum front with a 'D'. Charting a somewhat similar path, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than momentum investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. It comes with little surprise that the stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.
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AptarGroup (ATR) Up 7.2% Since Earnings Report: Can It Continue?
A month has gone by since the last earnings report for AptarGroup, Inc. (ATR - Free Report) . Shares have added about 7.2% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it 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 catalysts.
AptarGroup Beats on Q1 Earnings and Revenues
AptarGroup reported first-quarter 2017 earnings per share of $0.77, up 4% year over year. Earnings also beat the Zacks Consensus Estimate of $0.75. Earnings came at the higher end of the company’s guidance range of $0.72–$0.77 per share. On a reported basis, earnings per share increased 21% to $0.81 from $0.67 in the prior-year quarter.
Operational Update
Total revenue was up 3.3% year over year to $601 million in the reported quarter, surpassing the Zacks Consensus Estimate of $591 million. Excluding the negative impact from changes in currency exchange rates and the positive impact from acquisitions, core sales increased by 3%.
Cost of sales increased to $385 million from $374 million in the year-ago quarter. Gross profit improved 4% year over year to $385 million with gross margin expanding 30 basis points (bps) to 36%. Selling, research, development and administrative expenses went down 1% year over year to $101.5 million. Adjusted operating income increased 16% year over year to $69.5 million. AptarGroup’s operating margin expanded 130 bps year over year to 11.6%.
Segmental Performance
Total revenue in the Beauty and Homes segment went up 2.8% year over year to $322 million. Operating income decreased 6% to $22 million from $23.5 million in the year-ago quarter.
Total revenue in the Pharma segment went up 7.5% year over year to $197 million. Operating income grew 11% year over year to $59 million in the quarter.
Total revenue in the Food and Beverage segment dipped 3% year over year to $81.9 million. Operating income declined 23% year over year to $7.14 million.
Financial Performance
AptarGroup reported cash and cash equivalents of $284.7 million at the end of the first quarter, down from $466 million as of Dec 31, 2016. At the quarter end, long-term debt was approximately $771.3 million, down from $773 million as of Dec 31, 2016.
Outlook
For second-quarter 2017, AptarGroup expects earnings to be in the range of $0.92–$0.97. Comparable earnings per share for the prior year quarter were approximately $0.87.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed an upward trend in fresh estimates. There have been three revisions higher for the current quarter
AptarGroup, Inc. Price and Consensus
AptarGroup, Inc. Price and Consensus | AptarGroup, Inc. Quote
VGM Scores
At this time, the stock has a Growth Score of 'C', though it is lagging a bit on the momentum front with a 'D'. Charting a somewhat similar path, the stock was allocated a grade of 'D' on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'C'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than momentum investors.
Outlook
Estimates have been trending upward for the stock. The magnitude of these revisions also looks promising. It comes with little surprise that the stock has a Zacks Rank #2 (Buy). We are expecting an above average return from the stock in the next few months.