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Astec's (ASTE) Earnings & Revenues Miss Estimates in Q3


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Astec Industries, Inc.ASTE reported third-quarter 2018 earnings per share of 30 cents comparing favorably with the loss of 12 cents per share in the prior-year quarter. However, earnings missed the Zacks Consensus Estimate of 59 cents. Notably, the bottom-line performance marked the company's best third-quarter performance since 2012.

Astec reported total revenues of $257 million in the quarter ended September 2018, up 2% from $252 million posted in the year-ago quarter. However, the revenue figure missed the Zacks Consensus Estimate of $277 million. Astec's domestic sales dipped 1% year over year to $194 million. However, international sales increased 12% year over year to $62 million.

Cost of sales declined 7% year over year to $198 million. Gross profit came in at $58 million, up 49% from the year-ago quarter. Gross margin expanded 720 basis points to 22.7%.

Selling, general, administrative and engineering expenses went up 12% year over year to $51 million. The company reported adjusted operating profit of $7 million against the adjusted loss of $6 million recorded in the prior-year quarter.

Astec Industries, Inc. Price, Consensus and EPS Surprise

Astec Industries, Inc. Price, Consensus and EPS Surprise

Astec Industries, Inc. price-consensus-eps-surprise-chart | Astec Industries, Inc. Quote

Segment Performance



Revenues for the Infrastructure Group segment declined 12% to $87 million from $99 million in the year-ago quarter. The segment reported an operating profit of $4.8 million, compared with operating loss of $12.2 million witnessed in the year-earlier quarter.

Total revenues for the Aggregate and Mining Group segment inched up 2% year over year to $102 million. Profit declined 6% year over year to $9 million.

The Energy Group segment's total revenues jumped 26% year over year to $68 million. The segment reported operating profit of $3.3 million, down 26% from $4.5 million in the comparable period last year.

Financial Position

Astec reported cash and cash equivalents of $26 million at the end of the reported quarter, down from $66 million witnessed at the end of the year-ago quarter. Receivables increased to $128 million as of Sep 30, 2018, from $110 million as of Sep 30, 2017. Inventories were at $429 million as of Sep 30, 2018, compared with $399 million as of Sep 30, 2017.

The company's total backlog declined around 20% to $309 million as of Sep 30, 2018, from $386 million as of Sep 30, 2017. Backlog improved 39% and 18% in the Aggregate and Mining Group and Energy group, respectively. Backlog in the Infrastructure Group plunged 48%. Domestic backlog decreased 28% year over year to $223 million as of Sep 30, 2018, and international backlog advanced 12% year over year to $85 million at the end of the reported quarter.

During the quarter under review, the company repurchased approximately 297,000 shares of its common stock for $14 million.

The company noted order activity has been strong since the end of the third quarter, especially for products targeted at infrastructure customers. Backed by a strong backlog and recent order growth, the company is likely to deliver improved results in the fourth quarter of 2018. 

Share Price Performance

Astec's shares have depreciated 29% over the past year, compared with the industry 's decline of 7%. 

Zacks Rank & Other Stocks to Consider

Astec currently sports a Zacks Rank #1 (Strong Buy).You can see the complete list of today's Zacks #1 Rank stocks here .

Other top-ranked stocks the same sector include Atkore International Group Inc. ATKR , Donaldson Company, Inc. DCI and Enersys ENS . All three stocks sport a Zacks Rank #1.

Atkore International has a long-term earnings growth rate of 10%. The stock has gained 10% in a year's time.

Donaldson Company has a long-term earnings growth rate of 11.5%. Its shares have rallied 8% in the past year.

Enersys has a long-term earnings growth rate of 10%. The company's shares have been up 9% over the past year.

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



This article appears in: Investing , Business , Earnings , Stocks
Referenced Symbols: ATKR , ASTE , DCI , ENS



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