Back to top

Image: Bigstock

Understanding RPM International (RPM) Reliance on International Revenue

Read MoreHide Full Article

Have you looked into how RPM International (RPM - Free Report) performed internationally during the quarter ending May 2025? Considering the widespread global presence of this specialty chemicals company, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.

In the current era of a tightly interconnected global economy, the proficiency of a company to penetrate international markets significantly influences its financial health and trajectory of growth. For investors, the key is to grasp how reliant a company is on overseas markets, as this provides insights into the durability of its earnings, its ability to exploit different economic cycles, and its overall growth capabilities.

Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.

While analyzing RPM's performance for the last quarter, we found some intriguing trends in revenues from its overseas segments that Wall Street analysts commonly model and monitor.

The company's total revenue for the quarter amounted to $2.08 billion, showing rise of 3.7%. We will now explore the breakdown of RPM's overseas revenue to assess the impact of its international operations.

Unveiling Trends in RPM's International Revenues

During the quarter, Latin America contributed $72.56 million in revenue, making up 3.49% of the total revenue. When compared to the consensus estimate of $82.03 million, this meant a surprise of -11.54%. Looking back, Latin America contributed $66.44 million, or 4.50%, in the previous quarter, and $77.49 million, or 3.86%, in the same quarter of the previous year.

Of the total revenue, $302.71 million came from Europe during the last fiscal quarter, accounting for 14.54%. This represented a surprise of +7.65% as analysts had expected the region to contribute $281.2 million to the total revenue. In comparison, the region contributed $224.29 million, or 15.19%, and $263.4 million, or 13.12%, to total revenue in the previous and year-ago quarters, respectively.

Canada accounted for 7.15% of the company's total revenue during the quarter, translating to $148.82 million. Revenues from this region represented a surprise of +5.61%, with Wall Street analysts collectively expecting $140.91 million. When compared to the preceding quarter and the same quarter in the previous year, Canada contributed $87.1 million (5.90%) and $143.8 million (7.16%) to the total revenue, respectively.

Asia Pacific generated $37.9 million in revenues for the company in the last quarter, constituting 1.82% of the total. This represented a surprise of -16.74% compared to the $45.52 million projected by Wall Street analysts. Comparatively, in the previous quarter, Asia Pacific accounted for $37.72 million (2.55%), and in the year-ago quarter, it contributed $42.17 million (2.10%) to the total revenue.

During the quarter, Other Foreign contributed $26.5 million in revenue, making up 1.27% of the total revenue. When compared to the consensus estimate of $30.08 million, this meant a surprise of -11.89%. Looking back, Other Foreign contributed $24.42 million, or 1.65%, in the previous quarter, and $26.03 million, or 1.30%, in the same quarter of the previous year.

Prospective Revenues in International Markets

The current fiscal quarter's total revenue for RPM International, as projected by Wall Street analysts, is expected to reach $2.06 billion, reflecting an increase of 4.5% from the same quarter last year. The breakdown of this revenue by foreign region is as follows: Latin America is anticipated to contribute 4% or $81.36 million, Europe 13.6% or $278.71 million, Canada 6.4% or $131.33 million, Asia Pacific 2.2% or $45.92 million and Other Foreign 1.5% or $30.54 million.

For the entire year, the company's total revenue is forecasted to be $7.67 billion, which is an improvement of 4% from the previous year. The revenue contributions from different regions are expected as follows: Latin America will contribute 4.2% ($325.38 million), Europe 14.5% ($1.11 billion), Canada 6.9% ($528.43 million), Asia Pacific 2.4% ($182.51 million) and Other Foreign 1.6% ($121.25 million) to the total revenue.

Wrapping Up

Relying on international markets for revenues, RPM International faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.

In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.

We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.

The Zacks Rank, our proprietary stock rating mechanism, demonstrates a notable performance history confirmed through external audits. It effectively utilizes the power of earnings estimate revisions to act as a predictor of a stock's price performance in the near term.

RPM International, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Reviewing RPM International's Recent Stock Price Trends

Over the past month, the stock has gained 11.1% versus the Zacks S&P 500 composite's 4.9% increase. The Zacks Basic Materials sector, of which RPM International is a part, has risen 4.3% over the same period. The company's shares have increased 11.3% over the past three months compared to the S&P 500's 16% increase. Over the same period, the sector has risen 9.2%.

See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


RPM International Inc. (RPM) - free report >>

Published in