Why Is Century (CENX) Down 11.2% Since Last Earnings Report?
It has been about a month since the last earnings report for Century Aluminum (CENX). Shares have lost about 11.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Century due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Century Aluminum's Q2 Earnings & Sales Beat Estimates
Century Aluminum logged second-quarter 2023 earnings of 7 cents per share compared with the year-ago quarter's earnings of 36 cents.
Barring one-time items, earnings per share were 16 cents in the reported quarter against the Zacks Consensus Estimate of a loss of 12 cents. The company benefited from decreased energy prices, which were somewhat countered by an unfavorable sales mix and operational expenditures aimed at ensuring stability.
Revenues and Shipments
The company generated net sales of $575.5 million in the reported quarter, down around 32.8% year over year. The figure however beat the Zacks Consensus Estimate of $521.2 million.
Primary aluminum shipments were 173,649 tons, down around 18.8% year over year. It lagged our estimate of 189,200 tons.
Financials
At the end of the quarter, the company had cash and cash equivalents of $50.6 million, up 68.7% year over year.
Net cash used by operating activities was $1.9 million in the six-month period (ended Jun 30, 2023) against net cash provided of $68.6 million in the year-ago period.
Outlook
Century expects adjusted EBITDA in the third quarter to be in the range of $10-$20 million, factoring in the impact of lower LME aluminum prices and value-added premium sales, partially mitigated by higher volume, as well as reduced costs for raw materials and operations.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
The consensus estimate has shifted -3100% due to these changes.
VGM Scores
Currently, Century has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Century has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Century Aluminum Company (CENX) : Free Stock Analysis Report
