We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Why Is Johnson Controls (JCI) Up 17.8% Since Last Earnings Report?
Read MoreHide Full Article
A month has gone by since the last earnings report for Johnson Controls (JCI - Free Report) . Shares have added about 17.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Johnson Controls 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.
Johnson Controls Q2 Earnings Top, Revenues Lag Estimates
Johnson Controls reported second-quarter fiscal 2024 (ended Mar 31, 2024) adjusted earnings of 78 cents per share, which beat the Zacks Consensus Estimate of 75 cents. The bottom line increased 4% year over year.
Total revenues of $6.70 billion missed the consensus estimate of $6.75 billion. While the top line was relatively flat year over year, organic revenues inched up 1%.
Segmental Results
Building Solutions North America: Revenues were $2.74 billion, up 9% year over year. Organic sales jumped 8%, driven by the strong performance of applied heating, ventilation and air conditioning (HVAC) & controls business. EBITA increased 18% year over year to $373 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues totaled $1.06 billion, up 3% year over year. Organic sales climbed 4% due to growth in service business. EBITA was $89 million, up 29% year over year.
Building Solutions Asia Pacific: Revenues decreased 26% to $491 million. Sales declined 23% organically due to weakness in the China region. EBITA was $54 million, down 32% year over year.
Global Products: Revenues declined 3% year over year to $2.40 billion. Organic sales were down 1% due to a decline in the global Residential HVAC business. EBITA was $429 million, down 12% year over year.
Margin Profile
In the fiscal second quarter, Johnson Controls’ cost of sales increased 1.6% year over year to $4.52 billion. Gross profit decreased 2.7% year over year to $2.18 billion and the margin decreased 90 basis points (bps) to 32.6%. Selling, general and administrative expenses were $2.25 billion, up 42.6% year over year.
Financial Position
Johnson Controls had cash and cash equivalents of $843 million as of Mar 31, 2024, compared with $835 million at the end of fiscal 2023. Long-term debt was $7.35 billion compared with $7.82 billion at the end of fiscal 2023.
In the first six months of fiscal 2024, the company used net cash of $449 million from operating activities against $18 million generated in the year-ago period. It reported free cash outflow of $674 million in the first six months of fiscal 2024 compared with $237 million in the year-ago period.
The company repurchased 8 million shares for $474 million in the second quarter of fiscal 2024.
Fiscal Q3 Guidance
Johnson Controls anticipates organic revenue growth to be in low-single digits from the year-ago levels. Adjusted segment EBITA margin is estimated to be approximately 17%. JCI expects adjusted earnings in the range of $1.05-$1.10 per share.
FY24 Guidance
Johnson Controls anticipates organic revenue growth to be in the mid-single digits from the prior-year levels. Adjusted segment EBITA margin is expected to improve 50-75 bps from the year-ago actuals. JCI expects adjusted earnings in the range of $3.60-$3.75 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
At this time, Johnson Controls has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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, Johnson Controls 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
Johnson Controls is part of the Zacks Security and Safety Services industry. Over the past month, ADT (ADT - Free Report) , a stock from the same industry, has gained 6.3%. The company reported its results for the quarter ended March 2024 more than a month ago.
ADT reported revenues of $1.21 billion in the last reported quarter, representing a year-over-year change of -25%. EPS of $0.16 for the same period compares with $0.12 a year ago.
For the current quarter, ADT is expected to post earnings of $0.17 per share, indicating a change of +6.3% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for ADT. Also, the stock has a VGM Score of A.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Why Is Johnson Controls (JCI) Up 17.8% Since Last Earnings Report?
A month has gone by since the last earnings report for Johnson Controls (JCI - Free Report) . Shares have added about 17.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Johnson Controls 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.
Johnson Controls Q2 Earnings Top, Revenues Lag Estimates
Johnson Controls reported second-quarter fiscal 2024 (ended Mar 31, 2024) adjusted earnings of 78 cents per share, which beat the Zacks Consensus Estimate of 75 cents. The bottom line increased 4% year over year.
Total revenues of $6.70 billion missed the consensus estimate of $6.75 billion. While the top line was relatively flat year over year, organic revenues inched up 1%.
Segmental Results
Building Solutions North America: Revenues were $2.74 billion, up 9% year over year. Organic sales jumped 8%, driven by the strong performance of applied heating, ventilation and air conditioning (HVAC) & controls business. EBITA increased 18% year over year to $373 million.
Building Solutions Europe, Middle East, Africa/Latin America: Revenues totaled $1.06 billion, up 3% year over year. Organic sales climbed 4% due to growth in service business. EBITA was $89 million, up 29% year over year.
Building Solutions Asia Pacific: Revenues decreased 26% to $491 million. Sales declined 23% organically due to weakness in the China region. EBITA was $54 million, down 32% year over year.
Global Products: Revenues declined 3% year over year to $2.40 billion. Organic sales were down 1% due to a decline in the global Residential HVAC business. EBITA was $429 million, down 12% year over year.
Margin Profile
In the fiscal second quarter, Johnson Controls’ cost of sales increased 1.6% year over year to $4.52 billion. Gross profit decreased 2.7% year over year to $2.18 billion and the margin decreased 90 basis points (bps) to 32.6%. Selling, general and administrative expenses were $2.25 billion, up 42.6% year over year.
Financial Position
Johnson Controls had cash and cash equivalents of $843 million as of Mar 31, 2024, compared with $835 million at the end of fiscal 2023. Long-term debt was $7.35 billion compared with $7.82 billion at the end of fiscal 2023.
In the first six months of fiscal 2024, the company used net cash of $449 million from operating activities against $18 million generated in the year-ago period. It reported free cash outflow of $674 million in the first six months of fiscal 2024 compared with $237 million in the year-ago period.
The company repurchased 8 million shares for $474 million in the second quarter of fiscal 2024.
Fiscal Q3 Guidance
Johnson Controls anticipates organic revenue growth to be in low-single digits from the year-ago levels. Adjusted segment EBITA margin is estimated to be approximately 17%. JCI expects adjusted earnings in the range of $1.05-$1.10 per share.
FY24 Guidance
Johnson Controls anticipates organic revenue growth to be in the mid-single digits from the prior-year levels. Adjusted segment EBITA margin is expected to improve 50-75 bps from the year-ago actuals. JCI expects adjusted earnings in the range of $3.60-$3.75 per share.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
At this time, Johnson Controls has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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, Johnson Controls 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
Johnson Controls is part of the Zacks Security and Safety Services industry. Over the past month, ADT (ADT - Free Report) , a stock from the same industry, has gained 6.3%. The company reported its results for the quarter ended March 2024 more than a month ago.
ADT reported revenues of $1.21 billion in the last reported quarter, representing a year-over-year change of -25%. EPS of $0.16 for the same period compares with $0.12 a year ago.
For the current quarter, ADT is expected to post earnings of $0.17 per share, indicating a change of +6.3% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #2 (Buy) for ADT. Also, the stock has a VGM Score of A.