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Barnes Group (B) Q2 Earnings & Revenues Miss, Decline Y/Y

Barnes Group, Inc. B reported disappointing second-quarter 2019 results, wherein both earnings and revenues missed estimates.

Earnings/ Revenues

Quarterly adjusted earnings came in at 75 cents per share, down 17% year over year from 90 cents. Moreover, the bottom line lagged the Zacks Consensus Estimate of 78 cents.

Revenues were $372 million, down 1% year over year. Also, the figure declined 4% organically. Notably, the top line missed the consensus estimate of $387 million.

Barnes Group, Inc. Price, Consensus and EPS Surprise

Barnes Group, Inc. Price, Consensus and EPS Surprise
Barnes Group, Inc. Price, Consensus and EPS Surprise

Barnes Group, Inc. price-consensus-eps-surprise-chart | Barnes Group, Inc. Quote

Segmental Breakup

Revenues from the Industrial segment were $233.4 million, down 6% year over year. The decline was caused by continued softness in its automotive end markets and unfavorable impact of foreign currency translation.

The Aerospace segment generated revenues of $138.3 million, up 10% year over year. The improvement was driven by solid aerospace OEM (Original Equipment Manufacturer) sales and growth in maintenance, repair and overhaul, and spare parts sales.

Costs/Margins

Cost of sales in the second quarter was $238.3 million, up 0.3% year over year. Selling, general and administrative expenses were $76.4 million, up from $73.8 million. Adjusted operating margin was 15.7%, down 130 basis points.

Balance Sheet/Cash Flow

Exiting the second quarter, Barnes Group had cash and cash equivalents of $94.9 million, down from $100.7 million recorded as of Dec 31, 2018. At the end of the reported quarter, long-term debt was $889.1 million compared with $936.4 million as of Dec 31, 2018.

In the first six months of 2019, cash from operating activities totaled $108.2 million compared with $88.6 million generated in the comparable year-ago period.

Outlook

Barnes Group has provided adjusted earnings view for 2019 in the range of $3.18-$3.28, lower than $3.23-$3.35 guided earlier.

Total revenues are likely to grow in the range of 3-4%, while organic revenue growth is predicted to be flat to up 1%. This is comparable with the company’s earlier revenue growth guided range of 4-6%, and 1-3% growth band of organic revenue growth.

Zacks Rank & Key Picks

Barnes Group currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the same space are DXP Enterprises, Inc. DXPE, Dover Corporation DOV and Roper Technologies, Inc. ROP. All these companies carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

DXP Enterprises delivered average earnings surprise of 48.47% in the trailing four quarters.

Dover pulled off average positive earnings surprise of 6.91% in the trailing four quarters.

Roper delivered average earnings surprise of 6.92% in the trailing four quarters.

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