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Why Is Phibro (PAHC) Up 2.2% Since Last Earnings Report?
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It has been about a month since the last earnings report for Phibro Animal Health (PAHC - Free Report) . Shares have added about 2.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Phibro due for a pullback? 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.
Phibro Q2 Earnings Surpass Estimates, 2022 View Up
Phibro Animal Health Corporation’s adjusted earnings per share of 37 cents for the second quarter of fiscal 2022 reflected an 8.8% increase from the year-ago adjusted figure. The metric surpassed the Zacks Consensus Estimate by 12.1%
Meanwhile, without adjustments, GAAP earnings per share for the second quarter was 43 cents, up 34.4% from the year-ago figure.
Net Sales
In the quarter under review, net sales totaled $232.7 million, up 12.9% from the year-ago quarter.
During the fiscal second quarter, Animal Health net sales increased 10.8% to $150.9 million. Within this segment, sales of medicated feed additives (MFAs) and others were $91.7 million, reflecting 12.4% year-over-year growth, driven by higher demand in North America and South America, indicating ongoing recovery from pandemic-led impact. The processing aids utilized by producers of ethanol, distillers corn oil and distillers grain products contributed $3.5 million to the overall net sales gain in MFAs and other.
Within Animal Health, nutritional specialty product sales rose 2.5% to $37.3 million, primarily due to increased selling prices and volumes as well as increased revenues from companion animal products.
Apart from this, net vaccine sales totaled $21.9 million, showing a rise of 19.7% year over year on increased domestic and international volumes.
Net sales at the Mineral Nutrition segment rose 23.1% year over year to $66.7 million on the increase in average selling prices of trace minerals correlated to the underlying raw material costs.
Net sales at the Performance Products segment fell 4.4% to $15.1 million. This decline was due to lower average selling prices and reduced volumes in copper-based products, partially offset by higher sales of personal care product ingredients.
Margins
Phibro’s fiscal second-quarter gross profit rose 3.7% year over year to $70.7 million. Gross margin contracted 271 basis points (bps) to 30.4%.
Selling, general and administrative expenses in the reported quarter were $48.4 million, unchanged from the year-ago quarter.
Operating profit rose 12.6% year over year to $22.3 million and operating margin contracted 2 bps to 9.6% in the quarter under review.
Financial Update
The company exited the fiscal second quarter with cash and short-term investments in hand of $95 million compared with $97 million at the end of first-quarter fiscal 2022.
Cumulative net cash used in operating activities at the end of the second quarter was $23.9 million compared with $28.6 million a year ago.
Cumulative capital expenditure amounted to $15.1 million at the end of the second quarter of fiscal 2022, compared with $14.7 in the year-ago figure.
Outlook
Phibro has updated its fiscal 2022 financial guidance.
The company projects net sales for fiscal 2022 in the range of $890.0-$920.0 million, an improvement from the earlier-provided band of $860.0-$890.0 million. The Zacks Consensus Estimate for the metric is pegged at $875.05 million.
Adjusted EPS was reiterated in the band of $1.30-$1.39, up from the earlier-provided band of $1.25-$1.32. The Zacks Consensus Estimate for the same is pinned at $1.28.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
Currently, Phibro has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Phibro has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Phibro (PAHC) Up 2.2% Since Last Earnings Report?
It has been about a month since the last earnings report for Phibro Animal Health (PAHC - Free Report) . Shares have added about 2.2% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Phibro due for a pullback? 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.
Phibro Q2 Earnings Surpass Estimates, 2022 View Up
Phibro Animal Health Corporation’s adjusted earnings per share of 37 cents for the second quarter of fiscal 2022 reflected an 8.8% increase from the year-ago adjusted figure. The metric surpassed the Zacks Consensus Estimate by 12.1%
Meanwhile, without adjustments, GAAP earnings per share for the second quarter was 43 cents, up 34.4% from the year-ago figure.
Net Sales
In the quarter under review, net sales totaled $232.7 million, up 12.9% from the year-ago quarter.
During the fiscal second quarter, Animal Health net sales increased 10.8% to $150.9 million. Within this segment, sales of medicated feed additives (MFAs) and others were $91.7 million, reflecting 12.4% year-over-year growth, driven by higher demand in North America and South America, indicating ongoing recovery from pandemic-led impact. The processing aids utilized by producers of ethanol, distillers corn oil and distillers grain products contributed $3.5 million to the overall net sales gain in MFAs and other.
Within Animal Health, nutritional specialty product sales rose 2.5% to $37.3 million, primarily due to increased selling prices and volumes as well as increased revenues from companion animal products.
Apart from this, net vaccine sales totaled $21.9 million, showing a rise of 19.7% year over year on increased domestic and international volumes.
Net sales at the Mineral Nutrition segment rose 23.1% year over year to $66.7 million on the increase in average selling prices of trace minerals correlated to the underlying raw material costs.
Net sales at the Performance Products segment fell 4.4% to $15.1 million. This decline was due to lower average selling prices and reduced volumes in copper-based products, partially offset by higher sales of personal care product ingredients.
Margins
Phibro’s fiscal second-quarter gross profit rose 3.7% year over year to $70.7 million. Gross margin contracted 271 basis points (bps) to 30.4%.
Selling, general and administrative expenses in the reported quarter were $48.4 million, unchanged from the year-ago quarter.
Operating profit rose 12.6% year over year to $22.3 million and operating margin contracted 2 bps to 9.6% in the quarter under review.
Financial Update
The company exited the fiscal second quarter with cash and short-term investments in hand of $95 million compared with $97 million at the end of first-quarter fiscal 2022.
Cumulative net cash used in operating activities at the end of the second quarter was $23.9 million compared with $28.6 million a year ago.
Cumulative capital expenditure amounted to $15.1 million at the end of the second quarter of fiscal 2022, compared with $14.7 in the year-ago figure.
Outlook
Phibro has updated its fiscal 2022 financial guidance.
The company projects net sales for fiscal 2022 in the range of $890.0-$920.0 million, an improvement from the earlier-provided band of $860.0-$890.0 million. The Zacks Consensus Estimate for the metric is pegged at $875.05 million.
Adjusted EPS was reiterated in the band of $1.30-$1.39, up from the earlier-provided band of $1.25-$1.32. The Zacks Consensus Estimate for the same is pinned at $1.28.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
Currently, Phibro has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Phibro has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.