American Woodmark Corporation
) hit a new 52-week high of $22.00 on August 21, the day of its
fiscal first quarter 2013 earnings release that saw an astounding
surprise of 333.33%. This Zacks #2 Rank, manufacturer and
distributor of cabinets and vanities sees bright prospects ahead
with the demand for new home construction gaining traction.
Solid First Quarter
American Woodmark's fiscal first quarter 2013 adjusted earnings
came in at 7 cents per share, well ahead of the Zacks Consensus
Estimate for a loss of 3 cents and the year-ago loss of 19 cents.
Results benefited primarily from top-line growth.
Total revenue was $148.3 million, which increased 13.0% from the
year-ago quarter, driven mostly by 40% sales growth in the new home
construction business. Total revenue also beat the Zacks Consensus
Estimate of $138 million. The company distributes its products
through two sales channels: remodeling and new construction.
Gross margin expanded 90 basis points to 14.9% on the back of
revenue growth and reduced fixed costs.
Earnings Momentum Climbing Sharply
The Zacks Consensus Estimate for fiscal 2013 has moved up by 110%
to 21 cents over the last 60 days, suggesting a year-over-year
increase of 127.1%. For fiscal 2014, the Zacks Consensus Estimate
has increased 16% to 58 cents over the same time frame,
representing a year-over-year increase of 182.8%.
American Woodmark currently trades at a price-to-book (P/B)
multiple of 2.10, reflecting a 96.3% premium to the peer group
average of 1.07. The P/S multiple for the stock is 0.52, which is
at a slight premium of 10.6% to the peer group average of 0.47.
However, given its strong fundamentals, the premium valuation looks
Chart Showing Consistent Rise Shares of American Woodmark have been
rising since early August 2012, before reaching the new 52-week
high. Moreover, the stock is currently trading above its 50- and
200-day moving averages, which stand at $18.73 and $16.51,
respectively. In fact, the stock has been consistently trading
above its 200-day moving average since mid-March 2012 and above its
50-day moving average since mid-August 2012.
Volume is fairly strong, averaging roughly 64K daily. The
year-to-date return for the stock is 39.89% compared with the
S&P 500's return of 13.97%.
Based in Winchester, Virginia, American Woodmark Corporation
manufactures and distributes kitchen cabinets and vanities for the
remodeling and new home construction markets. The company's leading
brands include American Woodmark, Timberlake, Shenandoah Cabinetry,
Potomac, and Waypoint Living Spaces. The company has a market cap
of $292.94 million.
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