Earnings Alert – Welbilt (NYSE:WBT) reports financial results

In Friday session, Welbilt (NYSE:WBT)’s shares saw a move of +1.69% to close at $21.02 with trading volume of 784.08 thousand shares. After a look at recent stock performance, shares have traded +6.99% off of the 50-day moving average and +13.37% off the 200-day moving average.

Shares of Welbilt (NYSE:WBT) have been recorded at -0.38% separated from the 52-week high of $21.10 and +44.37% away from the 52-week low of $14.56. Monitoring the stock price in relation to moving averages as well as highs and lows for the year might assist with evaluating future stock performance.

Welbilt, Inc. (NYSE: WBT) today announced financial results for its 2017 first quarter.

2017 First Quarter Highlights

  • Net sales were $328.0 million, an increase of 0.8 percent; organic third party net sales growth was 2.7 percent
  • Diluted earnings per share were $0.04; adjusted diluted earnings per share were $0.08
  • Earnings from operations were $35.0 million, an increase of 3.9 percent; as a percent of net sales, earnings from operations were 10.7 percent, an increase of 30 basis points
  • Adjusted operating EBITDA was $52.7 million, an increase of 5.2 percent; adjusted operating EBITDA margin was 16.1 percent, an increase of 70 basis points
  • Repriced $825 million Term Loan B at LIBOR + 300 basis points, achieving a 175 basis point reduction
  • Net sales in the first quarter were $328.0 million, a 0.8 percent increase (+2.7 percent organic, -0.4 percent divestitures, -1.5 percent foreign currency translation).

Net earnings in the first quarter were $5.0 million and diluted earnings per share were $0.04 compared to $18.1 million and $0.13 per share in the first quarter of 2016. Adjusted net earnings were $10.6 million and adjusted diluted earnings per share were $0.08 in the first quarter versus $20.9 million and $0.15 per share, respectively, in the first quarter of 2016. The first quarter of 2016 included only one month of interest expense following the company’s spin-off from The Manitowoc Company, Inc. on March 4, 2016. The effective tax rate in the first quarter was 29.6 percent compared to 20.3 percent in last year’s first quarter.

Earnings from operations were $35.0 million in the first quarter compared to $33.7 million in last year’s first quarter, an increase of 3.9 percent. As a percentage of net sales, earnings from operations were 10.7 percent in the quarter versus 10.4 percent in last year’s first quarter. Adjusted operating EBITDA was $52.7 million in the first quarter versus $50.1 million in last year’s first quarter, a 5.2 percent increase. As a percentage of net sales, first quarter adjusted operating EBITDA margin was 16.1 percent versus 15.4 percent last year, a 70 basis point improvement.

2017 Guidance

The company is reaffirming our full-year 2017 guidance ranges. It continues to expect end market conditions to remain good in the general market and to slowly improve in the large QSR and fast-casual markets. The company also expect to begin benefiting from 2016’s and 2017’s new product introductions. It will again focus on margin improvement through the continued execution of our Simplification and Right-Sizing initiatives. The company expect interest expense to be near the low end of its guidance range following the successful repricing of the $825 million Term Loan B.

  • Net sales growth: between -3.5 and -0.5 percent (organic -1 to +2 percent including a -1 percent impact from 80/20 product line simplification, divestitures -1 percent, foreign currency translation -1.5 percent);
  • Adjusted operating EBITDA margin: between 18.5 and 20 percent;
  • Interest expense: between $85 and $90 million;
  • Effective tax rate: between 29 and 32 percent, based on current tax laws;
  • Adjusted diluted EPS: between $0.65 and $0.75 per share, based on a forecast of 140.8 million fully diluted shares outstanding;
  • Amortization expense: between $30 and $33 million;
  • Depreciation expense: between $16 and $19 million;
  • Capital expenditures: between $23 and $28 million; and
  • Debt reduction: between $100 and $120 million.

Wall Street analysts have a consensus target price of $21.07 on the stock. Target Price predictions might differ vastly from analyst to analyst. This target is applying estimates from analysts polled at Thomson Reuters.

Investors may also track a company’s PEG or price to earnings growth ratio. The PEG ratio represents the ratio of the price to earnings to the anticipated future growth rate of the company. A PEG Ratio near one might be seen as fair value. If a company has a PEG Ratio above one, it may represent that the company is overvalued. A PEG Ratio under one may indicate that the company is undervalued. (NYSE:WBT) has a current PEG Ratio of 1.42.

About the Author

Jacob Roark
Jacob Roark
Jacob Roark also covers the business news across all market sectors for mostvolatilestocks.com. He also has an enormous knowledge of stock market.  Jacob holds an MBA degree from University of Florida. He has more than 10 years of experience in writing financial and market news. He previously worked at a number of companies in different role including web developer, software engineer and product manager. He currently covers Business news section for mostvolatilestocks.com. Email Contact - Jacob@mostvolatilestocks.com.

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