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Johnson Controls (JCI) Q3 Earnings & Revenues Beat Estimates

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Johnson Controls International plc (JCI - Free Report) reported adjusted earnings per share of 81 cents in third-quarter fiscal 2018, beating the Zacks Consensus Estimate of 80 cents. Moreover, earnings increased 14% from 50 cents recorded in third-quarter fiscal 2017.

Operational Update

Johnson Controls reported revenues of $8.1 billion, surpassing the Zacks Consensus Estimate of $7.96 billion. Revenues increased 6% year over year.

Cost of sales increased to $5.64 billion from $5.25 billion in the year-ago quarter. Gross profit rose to $2.47 billion from $2.43 billion in the year-ago quarter.

Selling, general and administrative expenses in the fiscal third quarter totaled $1.52 billion, down from the prior-year quarter figure of $1.61 billion.

Johnson Controls International plc Price, Consensus and EPS Surprise

Segment Results

Building Technologies & Solutions: This segment’s adjusted revenues were $6.28 billion, increasing from the year-ago quarter figure of $6.06 billion. Segment EBITA increased to $954 million from $908 million in third-quarter fiscal 2017.

Power Solutions: Adjusted revenues in this segment rose to $1.84 billion from $1.61 billion a year ago. Segment EBITA was $310 million, up from third-quarter fiscal 2017 level of $304 million.

Financial Position

Johnson Controls had cash and cash equivalents of $283 million as of Jun 30, 2018, down from $321 million as of Sep 30, 2017. Long-term debt declined to $10.37 billion in the quarter from $12 billion as of Sep 30, 2017.

In the reported quarter, the company repurchased 1.6 million shares for $60 million.

Guidance

Johnson Controls tweaked the adjusted EPS guidance for fiscal 2018 to $2.80-$2.82 from the previous $2.75 to $2.85.

Zacks Rank & Key Picks

Johnson Controls currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the auto space are Oshkosh Corporation (OSK - Free Report) , AB Volvo (VLVLY - Free Report) and Fox Factory Holding Corp. (FOXF - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Oshkosh has an expected long-term growth rate of 18.3%. Over the past year, shares of the company have moved up 6.7%.

AB Volvo has an expected long-term growth rate of 15%. Over the past year, shares of the company have gained 4%.

Fox Factory has an expected long-term growth rate of 15.8%. Shares of the company have risen 27.6% in a year’s time.

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