U.S. markets open in 7 hours 47 minutes
  • S&P Futures

    3,885.25
    +17.75 (+0.46%)
     
  • Dow Futures

    31,495.00
    +137.00 (+0.44%)
     
  • Nasdaq Futures

    13,152.50
    +97.25 (+0.74%)
     
  • Russell 2000 Futures

    2,252.30
    +23.20 (+1.04%)
     
  • Crude Oil

    60.09
    +0.34 (+0.57%)
     
  • Gold

    1,729.30
    -4.30 (-0.25%)
     
  • Silver

    26.68
    -0.19 (-0.72%)
     
  • EUR/USD

    1.2085
    -0.0003 (-0.02%)
     
  • 10-Yr Bond

    1.4150
    0.0000 (0.00%)
     
  • Vix

    24.10
    +0.75 (+3.21%)
     
  • GBP/USD

    1.3952
    -0.0004 (-0.03%)
     
  • USD/JPY

    106.8700
    +0.1600 (+0.15%)
     
  • BTC-USD

    49,456.17
    +505.88 (+1.03%)
     
  • CMC Crypto 200

    993.57
    +5.48 (+0.55%)
     
  • FTSE 100

    6,613.75
    +25.22 (+0.38%)
     
  • Nikkei 225

    29,559.10
    +150.93 (+0.51%)
     

Universal Stainless (USAP) Q4 Earnings & Sales Miss Estimates

  • 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.
Zacks Equity Research
  • 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.

Universal Stainless & Alloy Products, Inc. USAP reported earnings of $0.2 million or 2 cents per share in the fourth quarter of 2019, down 65.5% from $0.6 million or 7 cents per share in the prior-year quarter. Its earnings per share missed the Zacks Consensus Estimate of 3 cents.

Net sales of $55.2 million fell 3.3% year over year in the quarter and missed the Zacks Consensus Estimate of $57.3 million.

Q4 Highlights

In the reported quarter, revenues in Aerospace and Power generation end-markets increased 7.2% and 51.6% year over year to $37.6 million and $2.9 million, respectively.Revenues in Oil & Gas, Heavy Equipment, and General industrial, conversion services & other markets declined 0.4%, 91.8% and 22.1% to $6.3 million, $4.8 million and $3.6 million, respectively.

Overall gross margin for the fourth quarter declined 8.9% year over year to $5.9 million due to unfavorable product mix.

Universal Stainless & Alloy Products, Inc. Price, Consensus and EPS Surprise

 

Universal Stainless & Alloy Products, Inc. Price, Consensus and EPS Surprise
Universal Stainless & Alloy Products, Inc. Price, Consensus and EPS Surprise

Universal Stainless & Alloy Products, Inc. price-consensus-eps-surprise-chart | Universal Stainless & Alloy Products, Inc. Quote

Financials

Universal Stainless had cash and cash equivalents of $0.17 million at the end of 2019, down 95.4% year over year. The company’s long-term debt increased around 41% year over year to $60.4 million.

Net cash used in operating activities was $4.4 million for 2019. Capital expenditure for the fourth quarter increased 81.8% year over year to $4 million.

The company’s fourth-quarter income tax benefit increased around 50% year over year to $0.6 million. This was mainly on account of changes in state income tax items and increased R&D tax credits.

Guidance

Moving ahead, Universal Stainless expects hydraulic forge production activity to continue improving in 2020. Moreover, for 2020, the company anticipates savings in operating costs from its mid-size bar cell in the Dunkirk facility. For the year, it also expects improvements in its melting operations.

On the commercial side, Universal Stainless anticipates sales volume of tool steel to increase year over year due to developments in tool steel order entry. Further, it expects its premium alloy backlog to continue.

For 2020, the company also anticipates improved alignment of material costs year over year.

Moreover, Universal Stainless continues to evaluate the production outlook for Boeing 737 Max and its potential impact on order entry activity.

Price Performance

Shares of the company have dipped 6% in the past year compared with the industry’s 12.2% decline.

 

 

Zacks Rank & Stocks to Consider

Universal Stainless currently carries a Zacks Rank #5 (Strong Sell).

Some better-ranked stocks in the basic materials space are Daqo New Energy Corp. DQ, Royal Gold, Inc. RGLD and Commercial Metals Company CMC.

Daqo New Energy has a projected earnings growth rate of 326.3% for 2020. The company’s shares have rallied 60.1% in a year. It sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Royal Gold has an estimated earnings growth rate of 83.5% for fiscal 2020. It currently flaunts a Zacks Rank #1. Its shares have returned 39.4% in a year.

Commercial Metals has a Zacks Rank #2 (Buy) and a projected earnings growth rate of 17.3% for 2020. The company’s shares have rallied 33.1% in a year.

The Hottest Tech Mega-Trend of All

Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>


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
 
DAQO New Energy Corp. (DQ) : Free Stock Analysis Report
 
Royal Gold, Inc. (RGLD) : Free Stock Analysis Report
 
Commercial Metals Company (CMC) : Free Stock Analysis Report
 
Universal Stainless & Alloy Products, Inc. (USAP) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research