TimkenSteel (TMST) Earnings Beat Estimates in Q4, Revenues Miss
TimkenSteel Corporation TMST recorded a loss of $33.2 million or 75 cents per share in fourth-quarter 2022, against a profit of $57.1 million or $1.07 in the year-ago quarter.
Barring one-time items, adjusted loss per share was 10 cents, narrower than the Zacks Consensus Estimate of a loss of 26 cents.
Sales fell around 27% year over year to $245.4 million in the quarter. The figure missed the Zacks Consensus Estimate of $321.4 million. The top line was hurt by reduced shipments and lower surcharge revenue per ton as a result of lower scrap prices. This was partly offset by higher base sales prices and favorable product mix.
Timken Steel Corporation Price, Consensus and EPS Surprise
Timken Steel Corporation price-consensus-eps-surprise-chart | Timken Steel Corporation Quote
Operating Figures
Ship tons fell 35% year over year to 128,300 in the quarter. The downside was driven by reduced industrial and mobile shipments.
Manufacturing costs increased year over year due to lower cost absorption, inflationary cost pressure as well as higher maintenance and outside contractor costs.
FY22 Results
Earnings for full-year 2022 were $1.30 per share compared with $3.18 per share a year ago. Net sales rose around 4% year over year to $1,329.9 million.
Financials
At the end of 2022, the company had cash and cash equivalents of $257.2 million, down around 0.9% year over year.
The company generated $23.7 million in operating cash flow in the quarter.
Outlook
Moving ahead, TimkenSteel sees ship tons to increase sequentially in the first quarter by at least 25%. The company is seeing strong customer demand and its order book is projected to remain full for first-half 2023.
The company also expects capital expenditures to be around $45 million in 2023.
Price Performance
Shares of TimkenSteel have declined 6.9% in the past year compared with the 4.2% rise of the industry.
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Zacks Rank & Key Picks
TimkenSteel currently carries a Zacks Rank #5 (Strong Sell).
Better-ranked stocks worth considering in the basic materials space include Steel Dynamics, Inc. STLD, Commercial Metals Company CMC and Nucor Corporation NUE.
Steel Dynamics currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for STLD's current-year earnings has been revised 22.3% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 11.3%, on average. STLD has rallied around 68% in a year.
Commercial Metals currently carries a Zacks Rank #1. The consensus estimate for CMC's current-year earnings has been revised 10% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 16.7%, on average. CMC has gained around 30% in a year.
Nucor currently carries a Zacks Rank #1. The Zacks Consensus Estimate for NUE’s current-year earnings has been revised 12.5% upward in the past 60 days.
Nucor beat Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 7.7% on average. NUE’s shares have gained roughly 24% in the past year.
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