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American Outdoor Brands' (AOBC) Q3 Earnings Beat, Sales Miss

Zacks Equity Research

American Outdoor Brands Corporation AOBC reported third-quarter fiscal 2019 (ended Jan 31, 2019) financial results. The company’s adjusted earnings of 16 cents per share surpassed the Zacks Consensus Estimate of 12 cents by 33.3%. The bottom line also improved 77.8% from the year-ago quarter’s 9 cents.

However, the company incurred GAAP loss of 10 cents per share against earnings of 21 cents per share in third-quarter fiscal 2018.

Revenues

American Outdoor Brands’ total sales amounted to $162 million in the quarter under review, which missed the Zacks Consensus Estimate of $162.6 million by a whisker. However, the top line increased 2.9% from $157.4 million in the year-ago quarter.

American Outdoor Brands Corporation Price, Consensus and EPS Surprise

American Outdoor Brands Corporation Price, Consensus and EPS Surprise | American Outdoor Brands Corporation Quote

Operational Highlights

In the reported quarter, total operating loss was $2 million against operating income of $5.8 million generated during the year-ago quarter.

Gross margin was 33.4% compared with 29.8% in third-quarter fiscal 2018. American Outdoor Brands’ total operating expenses totaled $56.1million, up 36.6% from $41.1 million in the prior-year quarter. Higher general and administrative expenses were the primary reason for this downturn.

American Outdoor Brands’ cash and cash equivalents were $37.5 million compared with $48.9 million as of Apr 30, 2018.

Notes and loans payables (net) were $175.9 million as of Jan 31, 2019, down from $180.3 million as of Apr 30, 2018.

Cash inflow from operating activities in the first nine months of fiscal 2019 was $20.7 million against cash outflow of $4.5 million a year ago.

Guidance

For fourth-quarter fiscal 2019, American Outdoor Brands expects adjusted earnings of 11-15 cents per share. Revenues are anticipated to be $162-$172 million.

Meanwhile, the company reiterated its outlook for fiscal 2019. It continues to expect adjusted earnings of 69-73 cents per share on revenues of $625-$635 million. Currently, the Zacks Consensus Estimate for earnings and revenues is pegged at 72 cents and $631.6 million, respectively, both near the higher end of the company’s guided range.

Zacks Rank

American Outdoor Brands has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Defense Releases

Spirit AeroSystems Holdings SPR reported fourth-quarter 2018 adjusted earnings of $1.85 per share, which surpassed the Zacks Consensus Estimate of $1.78 by 4%.

Raytheon Company RTN reported fourth-quarter 2018 earnings per share (EPS) of $2.93 from continuing operations, which outpaced the Zacks Consensus Estimate of $2.89 by 1.4%. The bottom-line figure also improved a massive 117% from the year-ago quarter’s figure of $1.35.

The Boeing Company BA reported adjusted earnings of $5.48 per share for fourth-quarter 2018, which exceeded the Zacks Consensus Estimate of $4.52 by 21.2%. The bottom line reflected an improvement of 8% from $5.07 registered in the year-ago quarter.

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