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Trimble (TRMB) Up 10.9% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Trimble Navigation (TRMB - Free Report) . Shares have added about 10.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Trimble due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Trimble Q3 Earnings Beat Estimates, Revenues Up Y/Y
Trimble delivered third-quarter 2023 non-GAAP earnings of 68 cents per share, which surpassed the Zacks Consensus Estimate by 15.25% and increased 3% on a year-over-year basis.
Revenues of $957.3 million lagged the Zacks Consensus Estimate by 0.74% but increased 8.2% year over year.
Product revenues (accounting for 46.4% of total revenues) totaled $444 million, down 6% on a year-over-year basis. Subscription and services revenues (53.6% of total revenues) increased 24.5% year over year to $513.3 million.
The top-line growth was driven by solid momentum across the Buildings and Infrastructure, and Transportation segments. However, softness in the Resources and Utilities and Geospatial segments continued to be an overhang.
TRMB generated annualized recurring revenues of $1.94 billion in the reported quarter, which increased 25% on a year-over-year basis (up 13% on an organic basis).
Top Line in Detail
Buildings and Infrastructure revenues (41.3% of total revenues) were $395.1 million, which fell 6% year over year.
Our model estimates for third-quarter Buildings and Infrastructure revenues were pegged at $401.2 million.
Geospatial revenues (18.9% of total revenues) of $180.7 million fell 1.9% year over year.
Our model estimates for third-quarter Geospatial revenues were pegged at $172.8 million.
Resources and Utilities revenues (19.3% of total revenues) of $184.9 million were down 3.5% year over year.
Our model estimates for third-quarter Resources and Utilities revenues were pegged at $184.6 million.
Transportation generated revenues (20.5% of total revenues) were $196.6 million, up 35.2% on a year-over-year basis.
Our model estimates for third-quarter Transportation revenues were pegged at $203.1 million.
Operating Details
In third-quarter 2023, the non-GAAP gross margin came in at 65%, expanding 410 basis points (bps) year over year.
On a non-GAAP basis, operating expenses accounted for 38.7% of revenues, up 160 bps year over year.
Non-GAAP operating margin came in at 26.2%, which expanded 250 bps year over year.
Balance Sheet
At the end of third-quarter 2023, cash and cash equivalents were $216.8 million, down from $273.3 million at the end of second-quarter 2023.
Total debt was $3.05 billion at the end of third-quarter end compared with $3.19 billion at second-quarter end.
Guidance
For fourth-quarter 2023, Trimble expects revenues between $890 million and $930 million. The company expects non-GAAP earnings between 55 cents and 63 cents per share.
For 2023, Trimble expects revenues between $3.757 billion and $3.797 billion. Trimble now expects 2023 non-GAAP earnings between $2.58 and $2.66 per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -17.72% due to these changes.
VGM Scores
Currently, Trimble has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. 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 D. 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, Trimble 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
Trimble belongs to the Zacks Electronics - Miscellaneous Products industry. Another stock from the same industry, KLA (KLAC - Free Report) , has gained 11.3% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
KLA reported revenues of $2.4 billion in the last reported quarter, representing a year-over-year change of -12%. EPS of $5.74 for the same period compares with $7.06 a year ago.
For the current quarter, KLA is expected to post earnings of $5.88 per share, indicating a change of -20.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for KLA. Also, the stock has a VGM Score of A.
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Trimble (TRMB) Up 10.9% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Trimble Navigation (TRMB - Free Report) . Shares have added about 10.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Trimble due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Trimble Q3 Earnings Beat Estimates, Revenues Up Y/Y
Trimble delivered third-quarter 2023 non-GAAP earnings of 68 cents per share, which surpassed the Zacks Consensus Estimate by 15.25% and increased 3% on a year-over-year basis.
Revenues of $957.3 million lagged the Zacks Consensus Estimate by 0.74% but increased 8.2% year over year.
Product revenues (accounting for 46.4% of total revenues) totaled $444 million, down 6% on a year-over-year basis. Subscription and services revenues (53.6% of total revenues) increased 24.5% year over year to $513.3 million.
The top-line growth was driven by solid momentum across the Buildings and Infrastructure, and Transportation segments. However, softness in the Resources and Utilities and Geospatial segments continued to be an overhang.
TRMB generated annualized recurring revenues of $1.94 billion in the reported quarter, which increased 25% on a year-over-year basis (up 13% on an organic basis).
Top Line in Detail
Buildings and Infrastructure revenues (41.3% of total revenues) were $395.1 million, which fell 6% year over year.
Our model estimates for third-quarter Buildings and Infrastructure revenues were pegged at $401.2 million.
Geospatial revenues (18.9% of total revenues) of $180.7 million fell 1.9% year over year.
Our model estimates for third-quarter Geospatial revenues were pegged at $172.8 million.
Resources and Utilities revenues (19.3% of total revenues) of $184.9 million were down 3.5% year over year.
Our model estimates for third-quarter Resources and Utilities revenues were pegged at $184.6 million.
Transportation generated revenues (20.5% of total revenues) were $196.6 million, up 35.2% on a year-over-year basis.
Our model estimates for third-quarter Transportation revenues were pegged at $203.1 million.
Operating Details
In third-quarter 2023, the non-GAAP gross margin came in at 65%, expanding 410 basis points (bps) year over year.
On a non-GAAP basis, operating expenses accounted for 38.7% of revenues, up 160 bps year over year.
Non-GAAP operating margin came in at 26.2%, which expanded 250 bps year over year.
Balance Sheet
At the end of third-quarter 2023, cash and cash equivalents were $216.8 million, down from $273.3 million at the end of second-quarter 2023.
Total debt was $3.05 billion at the end of third-quarter end compared with $3.19 billion at second-quarter end.
Guidance
For fourth-quarter 2023, Trimble expects revenues between $890 million and $930 million. The company expects non-GAAP earnings between 55 cents and 63 cents per share.
For 2023, Trimble expects revenues between $3.757 billion and $3.797 billion. Trimble now expects 2023 non-GAAP earnings between $2.58 and $2.66 per share.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -17.72% due to these changes.
VGM Scores
Currently, Trimble has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. 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 D. 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, Trimble 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
Trimble belongs to the Zacks Electronics - Miscellaneous Products industry. Another stock from the same industry, KLA (KLAC - Free Report) , has gained 11.3% over the past month. More than a month has passed since the company reported results for the quarter ended September 2023.
KLA reported revenues of $2.4 billion in the last reported quarter, representing a year-over-year change of -12%. EPS of $5.74 for the same period compares with $7.06 a year ago.
For the current quarter, KLA is expected to post earnings of $5.88 per share, indicating a change of -20.3% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.1% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for KLA. Also, the stock has a VGM Score of A.