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Arconic (ARNC) Beats Earnings & Revenue Estimates in Q3
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Arconic Inc. logged profits (as reported) of $161 million or 32 cents per share in the third quarter of 2018, up from $119 million or 22 cents in the year-ago quarter. Earnings per share beat the Zacks Consensus Estimate of 30 cents.
Arconic reported revenues of $3,524 million, up around 8.9% year over year, exceeding the Zacks Consensus Estimate of $3,484.3 million. Organic revenues rose 7% year over year, driven by higher volumes across the board on the back of growth in automotive, aerospace engines, defense and industrial, commercial transportation as well as building & construction markets.
Engineered Products and Solutions: Revenues from the division came in at $1.6 billion for the reported quarter, up 6% year over year. Organic revenues in the segment rose 6%, supported by growth in aerospace engines and defense.
Global Rolled Products: Revenues in the division amounted to $1.4 billion in the quarter, up 16% year over year. Organic revenues in the segment rose 9%, driven by higher industrial and automotive volume.
Transportation and Construction Solutions: Revenues in the segment amounted to $530 million, up 1% year over year. Organic revenues in the segment rose 8%, supported by higher volume in commercial transportation and building and construction.
Financial Position
As of Sep 30, 2018, Arconic had cash and cash equivalents of roughly $1,535 million, down around 15.4% year over year. Long-term debt fell roughly 7.2% year over year to $6,315 million.
Adjusted free cash flow nearly tripled year over year to $115 million in the quarter.
Outlook
Arconic provided an updated guidance for 2018. It now expects adjusted earnings in the range of $1.28-$1.34 per share, up from the prior expectation of $1.17-$1.27 per share. However, it continues to expect revenues for 2018 in the range of $13.7-$14 billion and adjusted free cash flow of roughly $250 million.
Price Performance
Arconic's shares lost 8.5% in the past three months compared with the industry’s 23.7% decline.
Methanex has expected long-term earnings growth rate of 15%. Its shares have rallied 35.2% in the past year.
KMG Chemicals has expected long-term earnings growth rate of 28.5%. Its shares have rallied 35.6% in the past year.
CF Industries has expected long-term earnings growth rate of 6%. Its shares have gained 16.9% in a year.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Arconic (ARNC) Beats Earnings & Revenue Estimates in Q3
Arconic Inc. logged profits (as reported) of $161 million or 32 cents per share in the third quarter of 2018, up from $119 million or 22 cents in the year-ago quarter. Earnings per share beat the Zacks Consensus Estimate of 30 cents.
Arconic reported revenues of $3,524 million, up around 8.9% year over year, exceeding the Zacks Consensus Estimate of $3,484.3 million. Organic revenues rose 7% year over year, driven by higher volumes across the board on the back of growth in automotive, aerospace engines, defense and industrial, commercial transportation as well as building & construction markets.
Arconic Inc. Price, Consensus and EPS Surprise
Arconic Inc. Price, Consensus and EPS Surprise | Arconic Inc. Quote
Segment Highlights
Engineered Products and Solutions: Revenues from the division came in at $1.6 billion for the reported quarter, up 6% year over year. Organic revenues in the segment rose 6%, supported by growth in aerospace engines and defense.
Global Rolled Products: Revenues in the division amounted to $1.4 billion in the quarter, up 16% year over year. Organic revenues in the segment rose 9%, driven by higher industrial and automotive volume.
Transportation and Construction Solutions: Revenues in the segment amounted to $530 million, up 1% year over year. Organic revenues in the segment rose 8%, supported by higher volume in commercial transportation and building and construction.
Financial Position
As of Sep 30, 2018, Arconic had cash and cash equivalents of roughly $1,535 million, down around 15.4% year over year. Long-term debt fell roughly 7.2% year over year to $6,315 million.
Adjusted free cash flow nearly tripled year over year to $115 million in the quarter.
Outlook
Arconic provided an updated guidance for 2018. It now expects adjusted earnings in the range of $1.28-$1.34 per share, up from the prior expectation of $1.17-$1.27 per share. However, it continues to expect revenues for 2018 in the range of $13.7-$14 billion and adjusted free cash flow of roughly $250 million.
Price Performance
Arconic's shares lost 8.5% in the past three months compared with the industry’s 23.7% decline.
Zacks Rank & Stocks to Consider
Arconic currently carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the basic materials space are Methanex Corporation (MEOH - Free Report) , KMG Chemicals, Inc. and CF Industries Holdings, Inc. (CF - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Methanex has expected long-term earnings growth rate of 15%. Its shares have rallied 35.2% in the past year.
KMG Chemicals has expected long-term earnings growth rate of 28.5%. Its shares have rallied 35.6% in the past year.
CF Industries has expected long-term earnings growth rate of 6%. Its shares have gained 16.9% in a year.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>