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Valmont's (VMI) Earnings Beat, Revenues Miss Estimates in Q2
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Valmont Industries, Inc. (VMI - Free Report) reported profits of roughly $32.9 million or $1.46 per share in second-quarter 2018, down 27.8% from net earnings of around $45.7 million or $2.01 a year ago. Adjusted earnings in the quarter were $1.98 per share, exceeding the Zacks Consensus Estimate of $1.94.
Net sales in the quarter totaled $682.4 million, down 4.3% year over year. The figure lagged the Zacks Consensus Estimate of $710 million. Meanwhile, an improvement in revenues was observed in the Engineered Support Structures and Coatings segments.
Valmont Industries, Inc. Price, Consensus and EPS Surprise
Engineered Support Structures segment sales of $250.7 million were 5.9% higher than the prior-year quarter on improved demand for lighting and traffic structures in North America and Europe, higher highway safety product sales in Australia and India as well as favorable currency translation.
Utility Support Structures sales decreased 6.1% year over year to $197.7 million due to lower volumes attributed to a less favorable product mix in North America. Despite lower sales in offshore wind across Northern Europe, margins improved on an encouraging project mix compared to 2017.
Coatings segment recorded year-over-year net sales growth of 14.8% to $91.6 million. This was mainly driven by recovery of higher Zinc costs through pricing and increased broad-based industrial demand growth across all regions.
Agriculture-Related
Irrigation reported net sales of $162.9 million, down 13.5% year over year, affected by uncertainty of tariff and trade policies in North America and lower International compared with the previous year. Sales in North America were not comparable with second quarter of 2017. Trucker’s strike in Brazil and lower project volumes impacted segment profitability.
Financial Position
Valmont ended second-quarter 2018 with cash balance of $722.6 million, up roughly 61.2% year over year. Long-term debt at the end of the quarter was $988.5 million, up around 31%.
Outlook
The company expects adjusted earnings per share in the range of $7.55-$7.65 per share.
Valmont remains optimistic about its markets and businesses for the rest of 2018. As a result of pricing actions and improved demand in the lighting and traffic business, Valmont anticipate favorable revenue and profit comparisons in the Engineered Support Structures segment. Results in the Irrigation segment are expected to deteriorate from last year due to challenging end-market conditions. Owing to strong industrial demand, the Coatings segment is expected to perform in line with first-half results.
Price Performance
Valmont’s shares have lost around 2.7% over the last three months against the industry’s 1.8% rise.
Zacks Rank & Stocks to Consider
Valmont currently carries a Zacks Rank #5 (Strong Sell).
A few better-ranked stocks in the industrial space are MRC Global Inc. (MRC - Free Report) , Mitsui & Co. (MITSY - Free Report) and Capstone Turbine Corp. .
Mitsui & Co. has an expected long-term earnings growth rate of 2.5% and flaunts a Zacks Rank #1. Its shares have gained 17.9% over a year.
Capstone Turbine has an expected long-term earnings growth rate of 25% and carries a Zacks Rank #2 (Buy). Its shares have moved up 163.5% in a year.
More Stock News: Tech Opportunity worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential.
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Valmont's (VMI) Earnings Beat, Revenues Miss Estimates in Q2
Valmont Industries, Inc. (VMI - Free Report) reported profits of roughly $32.9 million or $1.46 per share in second-quarter 2018, down 27.8% from net earnings of around $45.7 million or $2.01 a year ago. Adjusted earnings in the quarter were $1.98 per share, exceeding the Zacks Consensus Estimate of $1.94.
Net sales in the quarter totaled $682.4 million, down 4.3% year over year. The figure lagged the Zacks Consensus Estimate of $710 million. Meanwhile, an improvement in revenues was observed in the Engineered Support Structures and Coatings segments.
Valmont Industries, Inc. Price, Consensus and EPS Surprise
Valmont Industries, Inc. Price, Consensus and EPS Surprise | Valmont Industries, Inc. Quote
Review of the Segments:
Infrastructure-Related
Engineered Support Structures segment sales of $250.7 million were 5.9% higher than the prior-year quarter on improved demand for lighting and traffic structures in North America and Europe, higher highway safety product sales in Australia and India as well as favorable currency translation.
Utility Support Structures sales decreased 6.1% year over year to $197.7 million due to lower volumes attributed to a less favorable product mix in North America. Despite lower sales in offshore wind across Northern Europe, margins improved on an encouraging project mix compared to 2017.
Coatings segment recorded year-over-year net sales growth of 14.8% to $91.6 million. This was mainly driven by recovery of higher Zinc costs through pricing and increased broad-based industrial demand growth across all regions.
Agriculture-Related
Irrigation reported net sales of $162.9 million, down 13.5% year over year, affected by uncertainty of tariff and trade policies in North America and lower International compared with the previous year. Sales in North America were not comparable with second quarter of 2017. Trucker’s strike in Brazil and lower project volumes impacted segment profitability.
Financial Position
Valmont ended second-quarter 2018 with cash balance of $722.6 million, up roughly 61.2% year over year. Long-term debt at the end of the quarter was $988.5 million, up around 31%.
Outlook
The company expects adjusted earnings per share in the range of $7.55-$7.65 per share.
Valmont remains optimistic about its markets and businesses for the rest of 2018. As a result of pricing actions and improved demand in the lighting and traffic business, Valmont anticipate favorable revenue and profit comparisons in the Engineered Support Structures segment. Results in the Irrigation segment are expected to deteriorate from last year due to challenging end-market conditions. Owing to strong industrial demand, the Coatings segment is expected to perform in line with first-half results.
Price Performance
Valmont’s shares have lost around 2.7% over the last three months against the industry’s 1.8% rise.
Zacks Rank & Stocks to Consider
Valmont currently carries a Zacks Rank #5 (Strong Sell).
A few better-ranked stocks in the industrial space are MRC Global Inc. (MRC - Free Report) , Mitsui & Co. (MITSY - Free Report) and Capstone Turbine Corp. .
MRC Global has an expected long-term earnings growth rate of 15% and sports a Zacks Rank #1 (Strong Buy). The stock moved up 34.5% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.
Mitsui & Co. has an expected long-term earnings growth rate of 2.5% and flaunts a Zacks Rank #1. Its shares have gained 17.9% over a year.
Capstone Turbine has an expected long-term earnings growth rate of 25% and carries a Zacks Rank #2 (Buy). Its shares have moved up 163.5% in a year.
More Stock News: Tech Opportunity worth $386 Billion in 2017
From driverless cars to artificial intelligence, we've seen an unsurpassed growth of high-tech products in recent months. Yesterday's science-fiction is becoming today's reality. Despite all the innovation, there is a single component no tech company can survive without. Demand for this critical device will reach $387 billion this year alone, and it's likely to grow even faster in the future.
Zacks has released a brand-new Special Report to help you take advantage of this exciting investment opportunity. Most importantly, it reveals 4 stocks with massive profit potential.
See these stocks now>>