Why Is Manitowoc (MTW) Down 4.8% Since the Last Earnings Report?
A month has gone by since the last earnings report for The Manitowoc Company, Inc. MTW. Shares have lost about 4.8% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Manitowoc Posts Loss in Q1, Misses Sales, Affirms View
Manitowoc reported first-quarter 2017 adjusted loss per share of $0.17 per share compared to a loss of $0.05 reported in the year-ago quarter. The reported loss came in line the Zacks Consensus Estimate.
Including special items, the company posted a loss of $0.26 per share in the reported quarter. It had also posted loss of $1.43 per share a year ago.
The maker of cranes and restaurant equipment posted a 28% year-over-year plunge in sales to $305.8 million in the reported quarter, adversely affected by the low level of backlog entering into 2017, mainly due to historically low levels of crawler crane demand. In addition, revenues missed the Zacks Consensus Estimate of $337 million.
Operational Update
Cost of sales declined 27% to $254 million in the reported quarter from $347.7 million in the prior-year quarter. Gross profit plummeted 34.9% year over year to $51.9 million. Additionally, gross margin contracted 160 basis points to 17%.
Engineering, selling and administrative expenses descended 12.6% year over year to $63.3 million. Adjusted operating loss was $11.4 million compared with a gain of $7.3 million in the year-ago quarter.
Backlog
Backlog for the quarter came in at $506.3 million as of March 31, 2017 as against $323.8 million in fourth-quarter 2016.
Financial Updates
Manitowoc ended the quarter with cash and temporary investments of $36 million compared with $69.9 million at year-end 2016. Long-term debt was $268.6 million as of Mar 31, 2017 compared with $269 million as of Dec 31, 2016. The company recorded cash used for operating activities of $32.5 million in the reported quarter compared with cash usage of $163.4 million recorded in the year-ago quarter.
Guidance
Manitowoc affirms its revenues to decline approximately 8–10% year over year in 2017. Adjusted EBITDA is anticipated to lie between $41 million and $59 million. Depreciation is projected at approximately $40–$45 million. Capital expenditures are estimated at approximately $30 million.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision lower for the current quarter.
The Manitowoc Company, Inc. Price and Consensus
The Manitowoc Company, Inc. Price and Consensus | The Manitowoc Company, Inc. Quote
VGM Scores
At this time, Manitowoc's stock has a poor Growth Score of 'F'. However, its Momentum is doing a bit better with a 'D'.The stock was allocated a grade of 'F' on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'F'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate investors will probably be better served looking elsewhere.
Outlook
Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.
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