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PolyOne's (POL) Q4 Earnings Beat Estimates, Revenues Lag
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PolyOne Corporation logged earnings from continuing operations of 8 cents per share for the fourth quarter of 2019, compared with a loss of 2 cents a year ago.
Barring one-time items, earnings were 34 cents per share for the quarter, up from 24 cents in the year ago-quarter. Earnings topped the Zacks Consensus Estimate of 30 cents. The bottom line was driven by strong results in the Specialty Engineered Materials segment, including record operating income from the Advanced Composites platform.
Revenues dropped around 3% year over year to $658.6 million in the quarter. The top line missed the Zacks Consensus Estimate of $692.3 million.
PolyOne Corporation Price, Consensus and EPS Surprise
For 2019, earnings from continuing operations were 97 cents per share, compared with $1.09 per share a year ago. Adjusted earnings were $1.69 per share for 2019, up 12% year over year.
Revenues were $2,862.7 million for the full year, down around 1% year over year.
Segment Highlights
Revenues from the Color, Additives and Inks division fell around 6% year over year to $226.7 million for the reported quarter. Segment operating income declined 9% year over year to $27.2 million. Growth in sustainable solutions was more than offset by softness in transportation applications. Weaker foreign currencies also impacted results.
Revenues from the Specialty Engineered Materials unit rose roughly 18% year over year to $177.5 million. Operating income surged 60% year over year to $19.5 million. Strength in the composite platform and North America wire and cable applications coupled with better mix offset weak demand in Europe and Asia and the unfavorable currency impact.
Distribution segment’s sales went down around 11% to $272.4 million. Operating income was flat year over year at $17 million.
Financials
The company ended 2019 with cash and cash equivalents of $864.7 million, a five-fold year-over-year increase. Long-term debt at the end of the year was $1,210.9 million, down around 9% year over year.
PolyOne generated cash from operating activities of $301.7 million for 2019, up 19% year over year.
Outlook
PolyOne noted that it entered 2020 with confidence in its ability to deliver double-digit adjusted earnings per share growth for this year and beyond.
The company, in December 2019, agreed to purchase Clariant’s global color and additive masterbatch business in a deal worth $1.45 billion. PolyOne expects the transaction to add $1.15 billion of annual revenues. It is also expected to generate synergies of $60 million that is projected to add 85 cents to adjusted earnings per share. The deal is also projected to increase EBITDA from specialty applications to more than 85% on a pro forma basis.
Price Performance
PolyOne’s shares are up 2.6% over a year against the 25.3% decline of the industry it belongs to.
Zacks Rank & Key Picks
PolyOne currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space include Daqo New Energy Corp. (DQ - Free Report) , Royal Gold, Inc. (RGLD - Free Report) and Pretium Resources Inc. .
Daqo New Energy has projected earnings growth rate of 326.3% for 2020 and sports a Zacks Rank #1 (Strong Buy). The company’s shares have rallied roughly 47% in a year’s time. You can see the complete list of today’s Zacks #1 Rank stocks here.
Royal Gold has estimated earnings growth rate of 83.5% for fiscal 2020 and carries a Zacks Rank #1. The company’s shares have shot up roughly 32% in a year’s time.
Pretium Resources has projected earnings growth rate of 106.9% for 2020 and carries a Zacks Rank #2 (Buy). The company’s shares have rallied around 42% over a year.
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Today you are invited to download our latest Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
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PolyOne's (POL) Q4 Earnings Beat Estimates, Revenues Lag
PolyOne Corporation logged earnings from continuing operations of 8 cents per share for the fourth quarter of 2019, compared with a loss of 2 cents a year ago.
Barring one-time items, earnings were 34 cents per share for the quarter, up from 24 cents in the year ago-quarter. Earnings topped the Zacks Consensus Estimate of 30 cents. The bottom line was driven by strong results in the Specialty Engineered Materials segment, including record operating income from the Advanced Composites platform.
Revenues dropped around 3% year over year to $658.6 million in the quarter. The top line missed the Zacks Consensus Estimate of $692.3 million.
PolyOne Corporation Price, Consensus and EPS Surprise
PolyOne Corporation price-consensus-eps-surprise-chart | PolyOne Corporation Quote
Full-Year Results
For 2019, earnings from continuing operations were 97 cents per share, compared with $1.09 per share a year ago. Adjusted earnings were $1.69 per share for 2019, up 12% year over year.
Revenues were $2,862.7 million for the full year, down around 1% year over year.
Segment Highlights
Revenues from the Color, Additives and Inks division fell around 6% year over year to $226.7 million for the reported quarter. Segment operating income declined 9% year over year to $27.2 million. Growth in sustainable solutions was more than offset by softness in transportation applications. Weaker foreign currencies also impacted results.
Revenues from the Specialty Engineered Materials unit rose roughly 18% year over year to $177.5 million. Operating income surged 60% year over year to $19.5 million. Strength in the composite platform and North America wire and cable applications coupled with better mix offset weak demand in Europe and Asia and the unfavorable currency impact.
Distribution segment’s sales went down around 11% to $272.4 million. Operating income was flat year over year at $17 million.
Financials
The company ended 2019 with cash and cash equivalents of $864.7 million, a five-fold year-over-year increase. Long-term debt at the end of the year was $1,210.9 million, down around 9% year over year.
PolyOne generated cash from operating activities of $301.7 million for 2019, up 19% year over year.
Outlook
PolyOne noted that it entered 2020 with confidence in its ability to deliver double-digit adjusted earnings per share growth for this year and beyond.
The company, in December 2019, agreed to purchase Clariant’s global color and additive masterbatch business in a deal worth $1.45 billion. PolyOne expects the transaction to add $1.15 billion of annual revenues. It is also expected to generate synergies of $60 million that is projected to add 85 cents to adjusted earnings per share. The deal is also projected to increase EBITDA from specialty applications to more than 85% on a pro forma basis.
Price Performance
PolyOne’s shares are up 2.6% over a year against the 25.3% decline of the industry it belongs to.
Zacks Rank & Key Picks
PolyOne currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space include Daqo New Energy Corp. (DQ - Free Report) , Royal Gold, Inc. (RGLD - Free Report) and Pretium Resources Inc. .
Daqo New Energy has projected earnings growth rate of 326.3% for 2020 and sports a Zacks Rank #1 (Strong Buy). The company’s shares have rallied roughly 47% in a year’s time. You can see the complete list of today’s Zacks #1 Rank stocks here.
Royal Gold has estimated earnings growth rate of 83.5% for fiscal 2020 and carries a Zacks Rank #1. The company’s shares have shot up roughly 32% in a year’s time.
Pretium Resources has projected earnings growth rate of 106.9% for 2020 and carries a Zacks Rank #2 (Buy). The company’s shares have rallied around 42% over a year.
Free: Zacks’ Single Best Stock Set to Double
Today you are invited to download our latest Special Report that reveals 5 stocks with the most potential to gain +100% or more in 2020. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.
This pioneering tech ticker had soared to all-time highs and then subsided to a price that is irresistible. Now a pending acquisition could super-charge the company’s drive past competitors in the development of true Artificial Intelligence. The earlier you get in to this stock, the greater your potential gain.
See 5 Stocks Set to Double>>