On March 25, Zacks Investment Research downgraded
EnPro Industries, Inc.
) to a Zacks Rank #5 (Strong Sell) owing to disappointing results
for the fourth quarter of 2013.
Why the Downgrade?
In the fourth quarter of 2013, EnPro's adjusted earnings per
share of 46 cents dropped 22% year over year, while revenues
declined to $275.5 million from $279.3 million in the
year-ago quarter. The year-over-year decrease in revenues was due
to a reduction in the parts and service demand along with lower
engine revenues in the company's Engine Products and Services
The company also recorded a year-over-year decline of 150
basis points in the gross margins to 31.1%. Adjusted earnings
before interest, income taxes, depreciation and amortization for
the reported quarter were $34.2 million versus $38.2 million in
the year-ago quarter.
Exiting the fourth quarter of 2013, EnPro also recorded a
sequential decline in cash and cash equivalents to $64.4 million.
In 2013, cash generation from operations declined to $61.7
million from $118.2 million in 2012. Moreover, in the coming
quarters, demand in the Engine Products and Services is expected
to remain low.
Following the results, the Zacks Consensus Estimate for
earnings per share decreased 9.6% to $2.44 for 2014, while the
same for 2015 declined 3.3% to $2.95 over the past 60 days.
EnPro Industries is a leader in sealing products, metal
polymer bearings, compressor systems and other engineered
products for use in critical applications by industries
Other Stocks to Consider
EnPro currently has a market capitalization of $1.5 billion.
Some better-ranked stocks in the industry include
The Middleby Corp.
). While Kadant sports a Zacks Rank #1 (Strong Buy), Middleby and
Xylem hold a Zacks Rank #2 (Buy).
KADANT INC (KAI): Free Stock Analysis Report
MIDDLEBY CORP (MIDD): Free Stock Analysis
ENPRO INDUS INC (NPO): Free Stock Analysis
XYLEM INC (XYL): Free Stock Analysis Report
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