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Valmont's (VMI) Earnings & Sales Surpass Estimates in Q1

Zacks Equity Research

Valmont Industries, Inc. VMI generated profits of roughly $36.5 million or $1.66 per share in first-quarter 2019, down from around $39.3 million or $1.72 in the year-ago quarter.

Barring one-time items, adjusted earnings in the quarter were $1.84 per share which beat the Zacks Consensus Estimate of $1.67.

Net sales in the quarter totaled $692.1 million, down roughly 0.9% year over year. The figure topped the Zacks Consensus Estimate of $677.2 million.  

Valmont Industries, Inc. Price, Consensus and EPS Surprise

 

Valmont Industries, Inc. Price, Consensus and EPS Surprise | Valmont Industries, Inc. Quote

Segment Highlights

Infrastructure-Related

Sales in the Engineered Support Structures segment totaled $230.3 million, up around 2.4% year over year. The upside can be attributed to improved pricing across the segment along with higher volumes in North America.

Sales in the Utility Support Structures rose roughly 16.2% year over year to $243.9 million, supported by sales of solar tracker structures from the Convert Italia buyout. Pricing actions also drove the top line.

Sales in the Coatings segment rose 2.2% year over year to $86.8 million. Per the company, sales generated from the recent acquisitions along with pricing actions boosted sales in the segment.

Agriculture-Related

Sales in the Irrigation unit amounted to $152.8 million, down around 18.7% year over year. Sales in North America were $108.5 million, lower than $109.9 million in the year-ago quarter.

Financial Position

Valmont ended the first quarter with cash and cash equivalents of $211.2 million, down roughly 56% year over year. Long-term debt at the end of the year was $741.6 million.

Outlook

The company has narrowed earnings per share expectation for 2019 to the range of $8.30-$8.90, from $8.10-$8.90.

It continues to expect revenue growth of 7-8% year over year in 2019. Capital spending for the year is unchanged from prior forecast of $90-$100 million.  

Price Performance

Valmont’s shares have lost around 5.4% in the past year compared with the industry’s 18.4% decline.



Zacks Rank & Other Key Picks

Valmont currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the basic materials space include Sandstorm Gold Ltd. SAND, Flexible Solutions International Inc FSI and W. R. Grace & Co GRA.

Sandstorm Gold has an expected earnings growth rate of 200% for the current year and sports a Zacks Rank #1 (Strong Buy). The company’s shares have gained around 12.6% in the past year.  You can see the complete list of today’s Zacks #1 Rank stocks here.

Flexible Solutions has an expected earnings growth rate of 171.4% for the current year and carries a Zacks Rank #2. Its shares have surged roughly 102.2% in the past year.

W. R. Grace has an expected earnings growth rate of 10.4% for the current year and carries a Zacks Rank #2. Its shares have gained around 9.8% in the past year.

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