Zacks Investment Research downgraded
Applied Industrial Technologies, Inc.
) to a Zacks Rank #5 (Strong Sell) on Nov 19, 2013.
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Why the Downgrade?
Applied Industrial Technologies reported a disappointing result
for the fiscal first quarter 2014 (ended Sep 30, 2013) on Oct 30.
Shares of the company since the earnings release have fallen
4.1%. A brief of the quarter's result is provided below:
Earnings per share came in at 63 cents, down 10% from the
year-ago earnings of 70 cents. As compared with the Zacks
Consensus Estimate of 71 cents, earnings fell short by 11.3%.
Revenue in the quarter decreased 0.9% year over year due
primarily to weak industrial demand. Volume was weak in the
Cost of sales was down 2.3% while operating expenses increased by
8.4%. Operating margin weakened to 6.5% versus 7.3% in the
For fiscal 2014, management of Applied Industrial Technologies
has revised down its revenue and earnings guidance. Sales are now
anticipated to be within a $2.43-$2.49 billion range versus the
$2.56-$2.61 billion range expected earlier, while earnings per
share are expected to be within a $2.65-$2.95 range, versus
$2.90-$3.15 expected earlier.
Weak results and guidance for the year have led to a downward
revision in earnings estimates for Applied Industrial
Technologies. In the last 30 days, the Zacks Consensus Estimate
has gone down by 8.9% to $2.76 for fiscal 2014 and has declined
7.5% to $3.21 for fiscal 2015.
We also have an
of -1.67% for the fiscal second quarter of 2014 and -0.62% for
fiscal year 2015.
Other Stocks to Consider
Applied Industrial is a $2.0 billion company, operating in the
industrial equipment wholesale industry. Howver, stocks to watch
out for in the industry are
) with Zacks Rank #1 (Strong Buy). Of two others,
), each come with a Zacks Rank #2 (Buy).