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Carpenter(CRS) - 2024 Q3 - Earnings Call Transcript
2024-05-01 17:30
Financial Performance and Key Metrics Changes - The company reported exceptional third-quarter performance, beating guidance by approximately 18%, generating $90 million in adjusted operating income, which is a record high, up 29% from the previous quarter [3][58] - The fourth-quarter guidance has been raised to a range of $110 million to $115 million in operating income, marking an 8% increase over previous guidance and a 25% increase over the record third-quarter performance [3][82] - The expected adjusted operating income for fiscal year 2024 is projected to be between $339 million and $344 million, setting an annual earnings record for the company [3][82] Business Line Data and Key Metrics Changes - The SAO segment reported net sales of $483 million, up 16% sequentially, driven by a favorable product mix and pricing actions [7] - The PEP segment saw net sales of $94.6 million, an 8% sequential increase, with operating income rising to $9.2 million from $7.1 million in the previous quarter [21] - The SAO segment achieved an operating income of $103.5 million, more than doubling profitability from the same quarter last year, with an adjusted operating margin of 21.4% [42] Market Data and Key Metrics Changes - Sales to aerospace and defense customers accounted for 57% of total revenue, increasing 28% sequentially and 30% year-over-year [59] - Medical sales represented 15% of total revenue, increasing 15% sequentially and 35% year-over-year, marking another record quarter [77] - The backlog remains at record levels, up 3% sequentially and 12% year-over-year, currently at three times the pre-COVID level [46] Company Strategy and Development Direction - The company is committed to serving customers with high-value applications in high-growth markets, focusing on improving productivity, product mix optimization, and pricing actions [9][23] - The management sees a strong demand outlook for both near-term and long-term, particularly in aerospace, defense, and medical markets [5][9] - The company is pulling forward its FY '27 target by one year, indicating confidence in its growth trajectory [10][47] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the operating environment, stating that demand significantly outpaces supply, and they do not foresee any near-term impacts from supply chain disruptions [24] - The company anticipates continued strong demand across all subsegments of aerospace and defense, indicating a "super cycle" in the market [94] - Management highlighted that they are just beginning their earnings growth cycle, with expectations of exceeding current guidance [32][95] Other Important Information - The effective tax rate for the third quarter was 37.6%, with an adjusted rate closer to 21% due to benefits from prior year tax positions [20] - The company generated $61.9 million in free cash flow during the quarter, marking a significant improvement from previous periods [58][62] - The company is focused on maintaining a conservative approach to external guidance while executing on its growth plans [10][32] Q&A Session Summary Question: Discussion on various end markets within aerospace and defense - Management noted strong demand across all submarkets, including engines and fasteners, with significant growth expected [54] Question: Impact of lower production rates on 737 MAX and 787 - Management indicated no significant impact on order intake, with adjustments being made rather than cancellations [69] Question: Free cash flow yield expectations on new long-term guidance - Management emphasized that free cash flow will continue to be aligned with operating income, with ongoing updates expected [85] Question: Lead times and production expectations - Lead times remain extended at 65 weeks or more, reflecting strong demand and capacity constraints [87] Question: Opportunities in the aftermarket - Management highlighted that the aerospace and defense market is in a growth phase, with strong demand across all segments [94]
Carpenter(CRS) - 2024 Q3 - Earnings Call Presentation
2024-05-01 16:13
• Leverage core strength in engineered materials and process capabilities to solve our customers current and anticipated challenges • Accelerating progress towards goal to double operating income vs. FY19 • Further growth anticipated beyond FY27 goal • Cash generation creates significant shareholder value 14 15 Non-GAAP Schedules © 2024 CRS Holdings, LLC. All rights reserved. 17 Management believes that removing the impact of raw material surcharge from operating margin provides a more consistent basis for ...
Is Carpenter Technology (CRS) Outperforming Other Basic Materials Stocks This Year?
Zacks Investment Research· 2024-04-26 14:45
The Basic Materials group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Is Carpenter Technology (CRS) one of those stocks right now? A quick glance at the company's year-to-date performance in comparison to the rest of the Basic Materials sector should help us answer this question.Carpenter Technology is one of 240 companies in the Basic Materials group. The Basic Materials group currently sits at #3 within the Zacks Sector Rank. The Zac ...
Carpenter Technology (CRS) Stock Drops Despite Market Gains: Important Facts to Note
Zacks Investment Research· 2024-04-24 23:16
Carpenter Technology (CRS) ended the recent trading session at $80.40, demonstrating a -0.14% swing from the preceding day's closing price. This move lagged the S&P 500's daily gain of 0.02%. Meanwhile, the Dow experienced a drop of 0.11%, and the technology-dominated Nasdaq saw an increase of 0.1%.Prior to today's trading, shares of the maker of stainless steels and special alloys had gained 17.57% over the past month. This has outpaced the Basic Materials sector's loss of 2.03% and the S&P 500's loss of 3 ...
Carpenter Technology (CRS) Is Up 9.31% in One Week: What You Should Know
Zacks Investment Research· 2024-04-12 17:01
Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for moment ...
Here's Why Carpenter Technology (CRS) is a Strong Momentum Stock
Zacks Investment Research· 2024-04-12 14:50
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.Zacks Premium includes access to the Zacks Style Scores as we ...
Carpenter Technology Announces Conference Call and Webcast
Newsfilter· 2024-04-05 20:05
PHILADELPHIA , April 05, 2024 (GLOBE NEWSWIRE) -- Carpenter Technology Corporation (NYSE:CRS) plans to host a conference call and webcast on Wednesday, May 1, 2024 at 10:00 a.m. ET to discuss the results of operations for the third quarter of fiscal year 2024, ended March 31, 2024. The call and webcast will follow the release of third quarter fiscal 2024 financial results before the market opens on Wednesday, May 1, 2024. Conference Call and Webcast Details What: Carpenter Technology Third Quarter Fiscal 2 ...
DOW Shares Rise 13% in 6 Months: What's Driving It?
Zacks Investment Research· 2024-03-22 17:31
Shares of Dow Inc. (DOW) have gained 13.4% over the past six months. The company has also outperformed its industry’s decline of 1% over the same time frame.Let’s dive into the factors behind this Zacks Rank #3 (Hold) stock’s price appreciation. Image Source: Zacks Investment ResearchWhat’s Going in DOW’s Favor?Better-than-expected earnings performance in the fourth quarter contributed to the run-up in the company’s shares. Its adjusted earnings of 43 cents per share for the quarter topped the Zacks Consens ...
FMC Shares Up 10% in 3 Months: What's Driving the Stock?
Zacks Investment Research· 2024-03-14 14:46
Shares of FMC Corporation (FMC) have gained 10.4% over the past three months. The company has also outperformed its industry’s decline of 1.6% over the same time frame. It has also topped the S&P 500’s roughly 9.7% rise over the same period.Let’s take a look into the factors that are driving this Zacks Rank #3 (Hold) stock.Image Source: Zacks Investment ResearchWhat’s Going in FMC’s Favor?FMC is benefiting from its efforts to expand product portfolio, boost market position and its cost-reduction actions ami ...
Wall Street Analysts See a 27.09% Upside in Carpenter (CRS): Can the Stock Really Move This High?
Zacks Investment Research· 2024-03-11 14:56
Shares of Carpenter Technology (CRS) have gained 7.2% over the past four weeks to close the last trading session at $67.93, but there could still be a solid upside left in the stock if short-term price targets of Wall Street analysts are any indication. Going by the price targets, the mean estimate of $86.33 indicates a potential upside of 27.1%.The mean estimate comprises three short-term price targets with a standard deviation of $13.32. While the lowest estimate of $75 indicates a 10.4% increase from the ...