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Apogee to Expand Product Offerings With UW Solutions Buyout
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Apogee Enterprises, Inc. (APOG - Free Report) announced that it has inked an agreement with Heartwood Partners to acquire UW Interco, LLC (UW Solutions) for $240 million in cash. This transaction is consistent with Apogee's goal of adding distinctive businesses with a great operational track record to its portfolio.
UW Solutions, a U.S. manufacturer, produces high-performance coated substrates for building products and graphic arts markets, boasting innovative formulations and iconic brands like ResinDEK, ChromaLuxe, RDC Coatings and Unisub.
Details of Apogee’s UW Solutions Acquisition
After completion, Apogee intends to incorporate UW Solutions into its Large-Scale Optical segment. This will establish a scalable growth platform in the specialized coatings and materials market.
The purchase price is approximately 8.5x UW Solutions' expected adjusted EBITDA for fiscal 2026. Apogee intends to finance the deal with cash on hand and its current credit facility.
APOG’s Benefits from the Deal
The deal is expected to yield $5 million in operational cost synergies by fiscal 2027. The transaction is projected to improve Apogee's long-term financial profile, including its revenue growth rate and adjusted EBITDA margin, as well as adjusted diluted earnings per share, beginning in fiscal 2026. The transaction is estimated to generate roughly $100 million in sales in fiscal 2026, with an adjusted EBITDA margin of around 20%.
APOG is broadening its product portfolio for non-residential construction by entering the manufacturing, warehousing and distribution center markets, while also intensifying its efforts to diversify the large-scale optical segment.
Apogee Tops Q1 Earnings Estimates
Apogee reported earnings per share of $1.44 in first-quarter fiscal 2025 (ended June 1, 2024), surpassing the Zacks Consensus Estimate of $1.16. The bottom line increased 37.1% year over year.
Apogee generated revenues of $331.5 million in the fiscal first quarter, down 8.3% year over year due to lower volume.
APOG’s Share Price Outperforms Industry
Shares of Apogee have gained 47% in the past year against the industry's decline of 4.8%.
The Zacks Consensus Estimate for Crane’s 2024 earnings is pegged at $5.07 per share. The consensus estimate for 2024 earnings has moved north by 6% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 11.2%. CR shares have gained 75.2% in a year.
Flowserve has an average trailing four-quarter earnings surprise of 18.2%. The Zacks Consensus Estimate for FLS’ 2024 earnings is pinned at $2.76 per share, which indicates year-over-year growth of 31.6%. The consensus estimate for 2024 earnings has moved north by 4% in the past 60 days. The company’s shares have gained 27.5% in a year.
The Zacks Consensus Estimate for RBC Bearings’ fiscal 2025 earnings is pegged at $9.71 per share. The consensus estimate for 2025 earnings has moved north by 1.4% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 4.7%. RBC shares have gained 27.2% in a year.
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Apogee to Expand Product Offerings With UW Solutions Buyout
Apogee Enterprises, Inc. (APOG - Free Report) announced that it has inked an agreement with Heartwood Partners to acquire UW Interco, LLC (UW Solutions) for $240 million in cash. This transaction is consistent with Apogee's goal of adding distinctive businesses with a great operational track record to its portfolio.
UW Solutions, a U.S. manufacturer, produces high-performance coated substrates for building products and graphic arts markets, boasting innovative formulations and iconic brands like ResinDEK, ChromaLuxe, RDC Coatings and Unisub.
Details of Apogee’s UW Solutions Acquisition
After completion, Apogee intends to incorporate UW Solutions into its Large-Scale Optical segment. This will establish a scalable growth platform in the specialized coatings and materials market.
The purchase price is approximately 8.5x UW Solutions' expected adjusted EBITDA for fiscal 2026. Apogee intends to finance the deal with cash on hand and its current credit facility.
APOG’s Benefits from the Deal
The deal is expected to yield $5 million in operational cost synergies by fiscal 2027. The transaction is projected to improve Apogee's long-term financial profile, including its revenue growth rate and adjusted EBITDA margin, as well as adjusted diluted earnings per share, beginning in fiscal 2026. The transaction is estimated to generate roughly $100 million in sales in fiscal 2026, with an adjusted EBITDA margin of around 20%.
APOG is broadening its product portfolio for non-residential construction by entering the manufacturing, warehousing and distribution center markets, while also intensifying its efforts to diversify the large-scale optical segment.
Apogee Tops Q1 Earnings Estimates
Apogee reported earnings per share of $1.44 in first-quarter fiscal 2025 (ended June 1, 2024), surpassing the Zacks Consensus Estimate of $1.16. The bottom line increased 37.1% year over year.
Apogee generated revenues of $331.5 million in the fiscal first quarter, down 8.3% year over year due to lower volume.
APOG’s Share Price Outperforms Industry
Shares of Apogee have gained 47% in the past year against the industry's decline of 4.8%.
Image Source: Zacks Investment Research
Apogee’s Zacks Rank & Stocks to Consider
APOG currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Industrial Products sector are Crane Company (CR - Free Report) , Flowserve Corporation (FLS - Free Report) and RBC Bearings Incorporated (RBC - Free Report) . Each of these companies carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Crane’s 2024 earnings is pegged at $5.07 per share. The consensus estimate for 2024 earnings has moved north by 6% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 11.2%. CR shares have gained 75.2% in a year.
Flowserve has an average trailing four-quarter earnings surprise of 18.2%. The Zacks Consensus Estimate for FLS’ 2024 earnings is pinned at $2.76 per share, which indicates year-over-year growth of 31.6%. The consensus estimate for 2024 earnings has moved north by 4% in the past 60 days. The company’s shares have gained 27.5% in a year.
The Zacks Consensus Estimate for RBC Bearings’ fiscal 2025 earnings is pegged at $9.71 per share. The consensus estimate for 2025 earnings has moved north by 1.4% in the past 60 days. The company has a trailing four-quarter average earnings surprise of 4.7%. RBC shares have gained 27.2% in a year.