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Ingevity (NGVT) Down 16.8% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Ingevity (NGVT - Free Report) . Shares have lost about 16.8% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Ingevity 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.
Ingevity’s Earnings and Revenues Miss Estimates in Q4
Ingevity recorded a profit of 41 cents per share in the fourth quarter of 2022 compared with 74 cents in the prior-year quarter.
Adjusted earnings in the reported quarter were 57 cents per share, down 27% year over year. The figure missed the Zacks Consensus Estimate of 90 cents.
The company’s revenues rose around 14% year over year to $383.6 million in the quarter, which lagged the Zacks Consensus Estimate of $385.1 million. The top line was driven by price increases across its businesses to mitigate the impact of input cost inflation. The increase in prices was partly offset by lower volumes resulting from consumer destocking.
Segment Highlights
The Performance Chemicals division generated revenues of $250.8 million in the reported quarter, rising around 23% year over year, primarily driven by price increases across all product lines and a shift toward high-value specialty products. Sales rose about 41% in Engineered Polymers while sales in Industrial Specialties went up roughly 12%.
Revenues in the Performance Materials unit remained flat year over year at $132.8 million, primarily due to lower sales resulting from the outbreak of COVID in China. Unfavorable currency movements also contributed to the same.
FY22 Results
Earnings, as adjusted, in full-year 2022 were $6.01 per share compared with $5.23 recorded a year ago. Net sales climbed 19.9% to $1,668.3 million.
Financials
Ingevity ended the quarter with cash and cash equivalents of $76.7 million, down around 72% year over year. Long-term debt was $1,472.5 million, up 17.8%.
Operating cash flow was $313.1 million in 2022. Free cash flow was $170.6 million in the year.
The company repurchased shares worth $6 million in the reported quarter.
Outlook
The company sees its sales for 2023 to the band of $1.9-$2.1 billion and adjusted EBITDA in the range of $495-$515 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -17.05% due to these changes.
VGM Scores
Currently, Ingevity has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the second 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
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Ingevity has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Ingevity belongs to the Zacks Chemical - Specialty industry. Another stock from the same industry, Ecolab (ECL - Free Report) , has gained 0.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2022.
Ecolab reported revenues of $3.67 billion in the last reported quarter, representing a year-over-year change of +9.1%. EPS of $1.27 for the same period compares with $1.28 a year ago.
For the current quarter, Ecolab is expected to post earnings of $0.86 per share, indicating a change of +4.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Ecolab. Also, the stock has a VGM Score of B.
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Ingevity (NGVT) Down 16.8% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Ingevity (NGVT - Free Report) . Shares have lost about 16.8% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Ingevity 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.
Ingevity’s Earnings and Revenues Miss Estimates in Q4
Ingevity recorded a profit of 41 cents per share in the fourth quarter of 2022 compared with 74 cents in the prior-year quarter.
Adjusted earnings in the reported quarter were 57 cents per share, down 27% year over year. The figure missed the Zacks Consensus Estimate of 90 cents.
The company’s revenues rose around 14% year over year to $383.6 million in the quarter, which lagged the Zacks Consensus Estimate of $385.1 million. The top line was driven by price increases across its businesses to mitigate the impact of input cost inflation. The increase in prices was partly offset by lower volumes resulting from consumer destocking.
Segment Highlights
The Performance Chemicals division generated revenues of $250.8 million in the reported quarter, rising around 23% year over year, primarily driven by price increases across all product lines and a shift toward high-value specialty products. Sales rose about 41% in Engineered Polymers while sales in Industrial Specialties went up roughly 12%.
Revenues in the Performance Materials unit remained flat year over year at $132.8 million, primarily due to lower sales resulting from the outbreak of COVID in China. Unfavorable currency movements also contributed to the same.
FY22 Results
Earnings, as adjusted, in full-year 2022 were $6.01 per share compared with $5.23 recorded a year ago. Net sales climbed 19.9% to $1,668.3 million.
Financials
Ingevity ended the quarter with cash and cash equivalents of $76.7 million, down around 72% year over year. Long-term debt was $1,472.5 million, up 17.8%.
Operating cash flow was $313.1 million in 2022. Free cash flow was $170.6 million in the year.
The company repurchased shares worth $6 million in the reported quarter.
Outlook
The company sees its sales for 2023 to the band of $1.9-$2.1 billion and adjusted EBITDA in the range of $495-$515 million.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -17.05% due to these changes.
VGM Scores
Currently, Ingevity has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the second 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
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Ingevity has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Ingevity belongs to the Zacks Chemical - Specialty industry. Another stock from the same industry, Ecolab (ECL - Free Report) , has gained 0.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2022.
Ecolab reported revenues of $3.67 billion in the last reported quarter, representing a year-over-year change of +9.1%. EPS of $1.27 for the same period compares with $1.28 a year ago.
For the current quarter, Ecolab is expected to post earnings of $0.86 per share, indicating a change of +4.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.2% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Ecolab. Also, the stock has a VGM Score of B.