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CNH Industrial (CNHI - Free Report) reported first-quarter 2024 adjusted earnings per share (EPS) of 33 cents, down from 35 cents in the prior-year quarter. The figure, however, beat the Zacks Consensus Estimate of 26 cents.
In the first quarter, consolidated revenues declined nearly 10% from the year-ago level to $4.82 billion and beat the consensus mark of $4.64 billion. The company’s net sales from industrial activities came in at $4.13 billion, down 14% due to lower industry demand and dealer inventory management.
CNH Industrial N.V. Price, Consensus and EPS Surprise
In the first quarter, net sales in the Agriculture segment fell 14% year over year to $3.37 billion, due to lower industry volume and dealer inventory management. The metric also missed our estimate of $3.39 billion. The segment’s adjusted EBIT came in at $421 million, down 26.1% year over year due to lower volumes. The figure also missed our estimate of $465.9 million. The adjusted EBIT margin decreased to 12.5% from 14.5%.
The Construction segment’s sales declined 11% year over year to $758 million as a result of lower volume across all regions. However, the metric beat our estimate of $755.7 million. Adjusted EBIT came in at $51 million, up 15.9% year over year, driven by improved product costs and lower SG&A expenses. The figure also outpaced our estimate of $37.3 million. The adjusted EBIT margin increased to 6.7% from 5.2%.
The Financial Services segment’s revenues went up 25% to $685 million, surpassing our estimate of $491 million on improved volumes and yields across all regions. Net income from the segment rose to $118 million from $78 million reported in the year-ago quarter.
Financial Details
CNH Industrial had cash and cash equivalents of $3.24 billion as of Mar 31, 2024, down from $4.32 billion as of Dec 31, 2023.
The company’s debt totaled $27.78 billion as of Mar 31, 2024, up from $27.33 billion as of Dec 31, 2023.
The company’s net cash used by operating activities was $894 million compared with $701 million reported in the year-ago period.
Negative free cash flow from industrial activities was $1.21 billion in the quarter compared with negative free cash flow of $673 million in the first quarter of 2023.
Updated Guidance 2024
For full-year 2024, Agriculture sales are now expected to decrease 11-15% compared with the earlier projected decline of 8-12%. Adjusted EBIT margin for the Agriculture segment is now expected in the band of 13.5-14.5% compared with the previous estimate of 14-15%. For the Construction segment, sales are expected to decline 7-11% year over year. Adjusted EBIT margin for the Construction segment is projected in the range of 5-6%.
The company’s free cash flow from industrial activities is anticipated in the range of $1.1-$1.3 billion, down from the previous guidance of $1.2-$1.4 billion. Adjusted EPS is now expected between $1.45 and $1.55, down from the previous estimate of $1.50-$1.60.
The Zacks Consensus Estimate for REZI’s 2024 sales and earnings suggests year-over-year growth of 0.94% and 22.15%, respectively. The EPS estimates for 2024 and 2025 have moved up 26 cents and $1.05, respectively, in the past seven days.
The Zacks Consensus Estimate for NWPX’s 2024 sales and earnings suggests year-over-year growth of 3.18% and 17.7%, respectively. The EPS estimates for 2024 and 2025 have improved 15 cents and 6 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for VMI’s 2024 earnings suggests year-over-year growth of 5.34%. The EPS estimates for 2024 and 2025 have improved 88 cents and 66 cents, respectively, in the past seven days.
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CNH Industrial (CNHI) Q1 Earnings Beat Estimates, Decline Y/Y
CNH Industrial (CNHI - Free Report) reported first-quarter 2024 adjusted earnings per share (EPS) of 33 cents, down from 35 cents in the prior-year quarter. The figure, however, beat the Zacks Consensus Estimate of 26 cents.
In the first quarter, consolidated revenues declined nearly 10% from the year-ago level to $4.82 billion and beat the consensus mark of $4.64 billion. The company’s net sales from industrial activities came in at $4.13 billion, down 14% due to lower industry demand and dealer inventory management.
CNH Industrial N.V. Price, Consensus and EPS Surprise
CNH Industrial N.V. price-consensus-eps-surprise-chart | CNH Industrial N.V. Quote
Segmental Performance
In the first quarter, net sales in the Agriculture segment fell 14% year over year to $3.37 billion, due to lower industry volume and dealer inventory management. The metric also missed our estimate of $3.39 billion. The segment’s adjusted EBIT came in at $421 million, down 26.1% year over year due to lower volumes. The figure also missed our estimate of $465.9 million. The adjusted EBIT margin decreased to 12.5% from 14.5%.
The Construction segment’s sales declined 11% year over year to $758 million as a result of lower volume across all regions. However, the metric beat our estimate of $755.7 million. Adjusted EBIT came in at $51 million, up 15.9% year over year, driven by improved product costs and lower SG&A expenses. The figure also outpaced our estimate of $37.3 million. The adjusted EBIT margin increased to 6.7% from 5.2%.
The Financial Services segment’s revenues went up 25% to $685 million, surpassing our estimate of $491 million on improved volumes and yields across all regions. Net income from the segment rose to $118 million from $78 million reported in the year-ago quarter.
Financial Details
CNH Industrial had cash and cash equivalents of $3.24 billion as of Mar 31, 2024, down from $4.32 billion as of Dec 31, 2023.
The company’s debt totaled $27.78 billion as of Mar 31, 2024, up from $27.33 billion as of Dec 31, 2023.
The company’s net cash used by operating activities was $894 million compared with $701 million reported in the year-ago period.
Negative free cash flow from industrial activities was $1.21 billion in the quarter compared with negative free cash flow of $673 million in the first quarter of 2023.
Updated Guidance 2024
For full-year 2024, Agriculture sales are now expected to decrease 11-15% compared with the earlier projected decline of 8-12%. Adjusted EBIT margin for the Agriculture segment is now expected in the band of 13.5-14.5% compared with the previous estimate of 14-15%. For the Construction segment, sales are expected to decline 7-11% year over year. Adjusted EBIT margin for the Construction segment is projected in the range of 5-6%.
The company’s free cash flow from industrial activities is anticipated in the range of $1.1-$1.3 billion, down from the previous guidance of $1.2-$1.4 billion. Adjusted EPS is now expected between $1.45 and $1.55, down from the previous estimate of $1.50-$1.60.
Zacks Rank & Key Picks
CNHI currently carries a Zacks Rank #3 (Hold).
Some better-ranked players in the Industrial Products sector are Resideo Technologies, Inc. (REZI - Free Report) , Northwest Pipe Company (NWPX - Free Report) and Valmont Industries, Inc. (VMI - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for REZI’s 2024 sales and earnings suggests year-over-year growth of 0.94% and 22.15%, respectively. The EPS estimates for 2024 and 2025 have moved up 26 cents and $1.05, respectively, in the past seven days.
The Zacks Consensus Estimate for NWPX’s 2024 sales and earnings suggests year-over-year growth of 3.18% and 17.7%, respectively. The EPS estimates for 2024 and 2025 have improved 15 cents and 6 cents, respectively, in the past seven days.
The Zacks Consensus Estimate for VMI’s 2024 earnings suggests year-over-year growth of 5.34%. The EPS estimates for 2024 and 2025 have improved 88 cents and 66 cents, respectively, in the past seven days.