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Andersons (ANDE) Q3 Earnings Miss Estimates, Revenues Down
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The Andersons, Inc. (ANDE - Free Report) reported earnings of 9 cents per share in third-quarter 2017, up 50% year over year. Earnings, however, missed the Zacks Consensus Estimates of 16 cents.
Operational Update
Revenues in the reported quarter declined 2.7% year over year to $837 million. Difficult market conditions impacted the results. Cost of sales fell 2% to $766.9 million from $782.6 million recorded in the prior-year quarter. Gross profit dropped 9.5% year over year to $69.7 million. Consequently, gross margin contracted 70 basis points to 8.3% in the quarter.
Operating, administrative and general expenses were down 13% year over year to $68.5 million. Andersons posted operating profit of $12.5 million in the third quarter compared with the loss of $17.5 million incurred in the year-earlier quarter.
The Andersons, Inc. Price, Consensus and EPS Surprise
The Grain Group: Revenues dipped 9.6% year over year to $497.6 million from $550.2 million generated in the year-earlier quarter. The segment reported an operating income of $2.6 million compared with $1.9 million posted in the comparable quarter last year, driven by continued strong grain storage capacity utilization.
The Ethanol Group: Revenues jumped 37.4% year over year to $191.5 million. The segment reported an operating profit of $6.1 million, considerably down from $9.5 million recorded in the year-ago quarter.
The Plant Nutrient Group: The segment reported revenues of $103.6 million, up 1.8% year over year. It reported an operating loss of $7.9 million compared to a loss of $7.2 million witnessed in third-quarter 2016 due to persistent low prices and margins.
The Rail Group: Revenues at this segment were up 12.8% year over year to $43.1 million. Operating income descended 9.3% to $6.1 million from $6.8 million recorded in the prior-year quarter.
Retail Group: Revenues tanked significantly to $0.74 million from $30 million generated in the year-ago quarter. The segment reported an operating profit of $4.4 million compared with a loss of $1.6 million in the year-earlier quarter.
Financial Performance
Andersons reported cash and cash equivalents of $24.5 million at the end of third-quarter 2017, significantly down from $78.2 million in the prior-year quarter. Long-term debt was $425.3 million as of Sep 30, 2017, compared with $447 million as of Sep 30, 2016.
Share Price Performance
In the last year, Andersons has underperformed its industry with respect to price performance. The stock has gained only 0.2%, while the industry has recorded growth of 15.4% during the same time frame.
Zacks Rank & Stocks to Consider
Andersons currently carries a Zacks Rank #3 (Hold).
BHP Billiton has an expected long-term growth rate of 5.3%.
POSCO has an expected long-term growth rate of 5%.
Southern Copper has an expected long-term growth rate of 35.1%.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
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Andersons (ANDE) Q3 Earnings Miss Estimates, Revenues Down
The Andersons, Inc. (ANDE - Free Report) reported earnings of 9 cents per share in third-quarter 2017, up 50% year over year. Earnings, however, missed the Zacks Consensus Estimates of 16 cents.
Operational Update
Revenues in the reported quarter declined 2.7% year over year to $837 million. Difficult market conditions impacted the results. Cost of sales fell 2% to $766.9 million from $782.6 million recorded in the prior-year quarter. Gross profit dropped 9.5% year over year to $69.7 million. Consequently, gross margin contracted 70 basis points to 8.3% in the quarter.
Operating, administrative and general expenses were down 13% year over year to $68.5 million. Andersons posted operating profit of $12.5 million in the third quarter compared with the loss of $17.5 million incurred in the year-earlier quarter.
The Andersons, Inc. Price, Consensus and EPS Surprise
The Andersons, Inc. Price, Consensus and EPS Surprise | The Andersons, Inc. Quote
Segment Performance
The Grain Group: Revenues dipped 9.6% year over year to $497.6 million from $550.2 million generated in the year-earlier quarter. The segment reported an operating income of $2.6 million compared with $1.9 million posted in the comparable quarter last year, driven by continued strong grain storage capacity utilization.
The Ethanol Group: Revenues jumped 37.4% year over year to $191.5 million. The segment reported an operating profit of $6.1 million, considerably down from $9.5 million recorded in the year-ago quarter.
The Plant Nutrient Group: The segment reported revenues of $103.6 million, up 1.8% year over year. It reported an operating loss of $7.9 million compared to a loss of $7.2 million witnessed in third-quarter 2016 due to persistent low prices and margins.
The Rail Group: Revenues at this segment were up 12.8% year over year to $43.1 million. Operating income descended 9.3% to $6.1 million from $6.8 million recorded in the prior-year quarter.
Retail Group: Revenues tanked significantly to $0.74 million from $30 million generated in the year-ago quarter. The segment reported an operating profit of $4.4 million compared with a loss of $1.6 million in the year-earlier quarter.
Financial Performance
Andersons reported cash and cash equivalents of $24.5 million at the end of third-quarter 2017, significantly down from $78.2 million in the prior-year quarter. Long-term debt was $425.3 million as of Sep 30, 2017, compared with $447 million as of Sep 30, 2016.
Share Price Performance
In the last year, Andersons has underperformed its industry with respect to price performance. The stock has gained only 0.2%, while the industry has recorded growth of 15.4% during the same time frame.
Zacks Rank & Stocks to Consider
Andersons currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector are BHP Billiton plc , POSCO (PKX - Free Report) and Southern Copper Corp. (SCCO - Free Report) . All three stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
BHP Billiton has an expected long-term growth rate of 5.3%.
POSCO has an expected long-term growth rate of 5%.
Southern Copper has an expected long-term growth rate of 35.1%.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Click here for Zacks' secret trade>>