Quaker Chemical's (KWR) Earnings and Sales Top Estimates in Q3
Quaker Chemical Corporation KWR recorded earnings of $1.87 per share in the third quarter of 2023, up from $1.44 per share in the year-ago quarter.
Barring one-time items, earnings came in at $2.05 per share for the reported quarter, topping the Zacks Consensus Estimate of $1.89.
Net sales fell around 0.3% year over year to $490.6 million in the quarter. It surpassed the Zacks Consensus Estimate of $483.6 million. Higher selling price, product mix as well as favorable currency swings were offset by lower volumes.
The increase in selling price and product mix was mainly attributable to higher selling prices across the segments. Weaker market conditions weighed on volumes.
Segment Highlights
Sales from the Americas segment fell around 3% year over year to $245.9 million in the reported quarter. It was below the consensus estimate of $253 million. Lower sales volumes more than offset higher selling price and product mix and a favorable foreign currency translation.
The EMEA unit recorded sales of $139.6 million in the quarter, up around 4% year over year. It was above the consensus estimate of $129 million. Higher selling price and product mix and the favorable currency impact were partly offset by lower sales volumes.
The Asia/Pacific unit logged sales of $105.1 million, up around 2% year over year. It was above the consensus estimate of $96 million. Sales rose due to higher sales volumes, partly offset by unfavorable foreign currency swings.
Financials
The company ended the quarter with cash and cash equivalents of around $198.4 million, up roughly 5% on a sequential comparison basis. Long-term debt was around $805 million, down around 7% sequentially.
Net operating cash flow was $199.5 million for nine months ended Sep 30, 2023.
Outlook
Moving ahead, Quaker Chemical said it expects the unsettled market conditions, especially in the Americas and EMEA, to continue through the end of 2023. KWR remains committed to execute its enterprise strategy as it collaborates with customers to provide value-added services and solutions. It is progressing to position the company to build upon its market leading position by further differentiating its customer intimacy model and accelerating new business wins.
Price Performance
Quaker Chemical’s shares are down 7.8% in the past year compared with the industry’s 10.8% rise.
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Zacks Rank & Key Picks
KWR currently has a Zacks Rank #3 (Hold).
Better-ranked stocks worth a look in the basic materials space include Koppers Holdings Inc. KOP, WestRock Company WRK and The Andersons Inc. ANDE.
Koppers has a projected earnings growth rate of 7.5% for the current year. It currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Koppers has a trailing four-quarter earnings surprise of roughly 21.7%, on average. KOP shares have rallied around 39% in a year.
In the past 60 days, the Zacks Consensus Estimate for WestRock’s current fiscal year has been revised upward by 5.2%. WRK, carrying a Zacks Rank #2, beat the Zacks Consensus Estimate in three of the last four quarters while missing in one quarter, with the average earnings surprise being 30.7%. The company’s shares have gained 3% in the past year. The company’s shares have gained 9% in the past year.
Andersons currently carries a Zacks Rank #2. The Zacks Consensus Estimate for ANDE's current-year earnings has been revised 3.3% upward over the past 60 days.
Andersons beat the Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 64.4%, on average. ANDE shares have rallied around 47% in a year.
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