U.S. markets open in 1 hour 18 minutes
  • S&P Futures

    3,933.75
    +17.50 (+0.45%)
     
  • Dow Futures

    31,590.00
    +103.00 (+0.33%)
     
  • Nasdaq Futures

    12,207.75
    +67.25 (+0.55%)
     
  • Russell 2000 Futures

    1,771.20
    +9.50 (+0.54%)
     
  • Crude Oil

    108.21
    +0.59 (+0.55%)
     
  • Gold

    1,834.40
    +4.10 (+0.22%)
     
  • Silver

    21.40
    +0.27 (+1.30%)
     
  • EUR/USD

    1.0574
    +0.0016 (+0.15%)
     
  • 10-Yr Bond

    3.1250
    0.0000 (0.00%)
     
  • Vix

    28.18
    -0.87 (-2.99%)
     
  • GBP/USD

    1.2262
    -0.0008 (-0.06%)
     
  • USD/JPY

    135.5220
    +0.3520 (+0.26%)
     
  • BTC-USD

    21,323.94
    -409.90 (-1.89%)
     
  • CMC Crypto 200

    464.97
    +11.07 (+2.44%)
     
  • FTSE 100

    7,249.92
    +41.11 (+0.57%)
     
  • Nikkei 225

    26,871.27
    +379.30 (+1.43%)
     

Carrier (CARR) Q1 Earnings Beat Estimates, Revenues Down Y/Y

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

Carrier Global CARR reported first-quarter 2022 adjusted earnings of 54 cents per share, which beat the Zacks Consensus Estimate by 14.9%. Further, the figure increased 13% year over year and 23% sequentially.

Net sales of $4.65 billion declined 1% year over year and 9% sequentially. However, the top line surpassed the Zacks Consensus Estimate by 3%.

The top-line decline was a result of the weak performance of the Refrigeration and Fire & Security segments. Yet, the HVAC segment aided the quarterly performance.

Product sales (90% of net sales) of $4.2 billion increased 8% year over year but declined 2% sequentially. Service sales (10% of net sales) of $484 million were down 42% year over year and 45% from the previous quarter.

Carrier Global Corporation Price, Consensus and EPS Surprise

Carrier Global Corporation Price, Consensus and EPS Surprise
Carrier Global Corporation Price, Consensus and EPS Surprise

Carrier Global Corporation price-consensus-eps-surprise-chart | Carrier Global Corporation Quote

Segment Details

HVAC revenues (63.8% of net sales) increased 19% year over year to $2.97 billion.

Refrigeration revenues (21% of net sales) declined 3% from the year-ago quarter to $976 million.

Fire & Security revenues (17.6% of net sales) of $818 million were down 37% year over year.

Operating Results

Research & development (R&D) expenses grew 3% year over year to $125 million. Selling, general & administrative (SG&A) expenses decreased 19% from the year-ago quarter to $601 million.

As a percentage of revenues, R&D expenses expanded 10 basis points (bps), but SG&A expenses contracted 290 bps year over year.

Adjusted operating profit increased 7% year over year to $650 million. Operating margin expanded 110 bps on a year-over-year basis to 14%.

Adjusted operating margin of the HVAC segment expanded 120 bps year over year to 16%. The Refrigeration segment reported an adjusted operating margin of 11.5%, contracting 130 bps. Adjusted operating margin of Fire & Security was 14.2%, expanding 160 bps year over year.

Balance Sheet

As of Mar 31, 2022, Carrier had cash and cash equivalents of $3.60 billion compared with $2.99 billion on Dec 31, 2021.

Total debt (including current portion) as of Mar 31, 2022 was $8.56 billion compared with $9.70 billion on Dec 31, 2021.

In the reported quarter, the company used $202 million cash in operations. It generated $913 million in cash from operations in the previous quarter.

Capital expenditure was $56 million versus $138 million in the fourth quarter of 2021. Free cash flow was a negative $258 million for the first quarter of 2022.

Guidance

For 2022, Carrier projects sales of $20 billion. The Zacks Consensus Estimate for the same is pegged at $19.86 billion.

The company expects adjusted earnings of $2.20-$2.30 per share. The Zacks Consensus Estimate for the same is pegged at $2.27 per share.

Carrier also expects a free cash flow of $1.65 billion for 2022.

Zacks Rank & Stocks to Consider

Currently, Carrier has a Zacks Rank #3 (Hold).

Investors interested in the broader technology sector can consider stocks like Jabil JBL, Jack Henry & Associates JKHY, and Broadcom AVGO. While Jabil currently sports a Zacks Rank #1 (Strong Buy), Jack Henry & Associates and Broadcom carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Jabil has gained 5.5% over a year. The long-term earnings growth rate for JBL is currently projected at 12%.

Jack Henry & Associates has gained 16.9% over a year. The long-term earnings growth rate for JKHY is currently projected at 17%.

Broadcom has gained 20% over a year. The long-term earnings growth rate for AVGO is currently projected at 14.5%.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Jabil, Inc. (JBL) : Free Stock Analysis Report

Broadcom Inc. (AVGO) : Free Stock Analysis Report

Jack Henry & Associates, Inc. (JKHY) : Free Stock Analysis Report

Carrier Global Corporation (CARR) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research