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H.B. Fuller Q2 Results Top Estimates

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H.B. Fuller Company (FUL) reported better-than-expected results for the second quarter of 2021. The global adhesives company’s robust results can be attributed primarily to the growth in net revenues.

Following the earnings release, shares of the company declined 2.4% to close at $64.12 in Wednesday’s extended trading session.

The company reported quarterly net revenues of $828 million, up 22.7% from last year. This growth is primarily due to an 18.8% year-over-year increase in organic revenues. Moreover, it surpassed the consensus estimate of $764.4 million.

Notably, H.B. Fuller reported adjusted EPS of $0.94, which denotes a growth of 38% from last year. Furthermore, it topped the consensus estimate of $0.92 per share.

CEO of H.B. Fuller Jim Owens said, “H.B. Fuller did an outstanding job supporting customers during the quarter, and we delivered another quarter of strong sales and earnings growth. Despite considerable raw material and packaging shortages, H.B. Fuller was able to meet a sizeable increase in demand by leveraging our extensive global network and partnering with customers and suppliers.” (See H.B. Fuller stock chart on TipRanks)

Recently, Berenberg analyst Paretosh Misra reiterated a Buy rating on the stock. The analyst raised the price target from $63 to $70 (6.6% upside potential).

“In the backdrop of concerns that rising raw material costs might negatively impact margins, FUL’s 2021 outlook came in above consensus expectations. The company’s Engineering Adhesives business in particular should see strong growth in 2021, in our view. Net leverage continues to decline, which should support a further re-rating of the stock,” the analyst said.

Consensus among analysts is a Strong Buy based on 3 Buys and 1 Hold. The average H.B. Fuller analyst price target of $68.75 implies upside potential of 4.7% from current levels. Shares of the company have gained 60% over the past year.

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