Altra Down to Strong Sell - Analyst Blog

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Zacks Investment Research downgraded Altra Holdings, Inc. ( AIMC ) to a Zacks Rank #5 (Strong Sell) on Jul 27, based on weak second-quarter 2013 results combined with a weak outlook for the quarters ahead.

Why the Downgrade?

Altra reported earnings per share of 41 cents in the second quarter of 2013, missing the Zacks Consensus Estimate by 12.8%. Revenues came in at $181.1 million, missing the Zacks Consensus Estimate of $189.0 million as well as the year-ago quarter's revenues by 3.6%.

The decline was brought about by a downturn in demand of the capital-intensive end markets like metals, mining and energy. Moreover, demands in North America and Asia were lower than expected. Margins also faced a decline in the quarter owing to higher selling, general and administrative (SG&A) expenses. The trend is expected to continue in the coming quarters as well.

Accordingly, Altra has reduced its outlook for 2013. The company expects revenues in the range of $715.0 million to $730.0 million in 2013, down from $740.0 million to $750.0 million as expected earlier. Moreover, Altra lowered its earnings per share expectation to a range of $1.52 to $1.64 from $1.75 to $1.85 as expected before.

Subsequent to the results, Altra witnessed a downward revision for most of its estimates for years 2013 and 2014. All the estimates have been revised downwards for 2013, resulting in a decline in the Zacks Consensus Estimate by 8.2% to $1.67 per share, over the last 7 days. The Zacks Consensus Estimate for 2014 was also reduced by 5.7% to $1.99 per share in the same period.

Other Stocks to Consider

Other machinery stocks that are worth a look include Gorman-Rupp Co. ( GRC ), Chart Industries Inc. ( GTLS ) and Dover Corporation ( DOV ). While Gorman-Rupp carries a Zacks Rank #1 (Strong Buy), Chart Industries and Dover Corporation carry a Zacks Rank #2 (Buy).



ALTRA HOLDINGS (AIMC): Free Stock Analysis Report

DOVER CORP (DOV): Free Stock Analysis Report

GORMAN RUPP CO (GRC): Free Stock Analysis Report

CHART INDUSTRIE (GTLS): Free Stock Analysis Report

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Zacks Investment Research



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Stocks

Referenced Stocks: AIMC , DOV , GRC , GTLS

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