Core Insights - The Zacks Equity Research team has highlighted several stocks, including AbbVie Inc., RTX Corp., International Business Machines Corp., EVI Industries, Inc., and Rocky Mountain Chocolate Factory, Inc. in their Analyst Blog [1][2] AbbVie Inc. (ABBV) - AbbVie shares have increased by 13.8% over the past six months, while the Zacks Large Cap Pharmaceuticals industry has gained 29.5% [4] - The company exceeded fourth-quarter estimates for both earnings and sales, successfully managing the loss of exclusivity for Humira by launching new immunology drugs, Skyrizi and Rinvoq, which are performing well [4][5] - AbbVie's neuroscience portfolio is also contributing to revenue growth, with robust net sales growth reported in 2025, marking the second full year post-Humira's loss of exclusivity [5] RTX Corp. (RTX) - RTX shares have outperformed the Zacks Aerospace - Defense industry, gaining 29.2% compared to 11.7% over the past six months [6] - The company reported fourth-quarter earnings and revenues that surpassed estimates, benefiting from strong orders for defense products from the Pentagon and foreign allies [6][7] - RTX's backlog reached $268 billion as of December 31, 2025, supported by improving global commercial air traffic [8] International Business Machines Corp. (IBM) - IBM shares have risen by 10.8% over the past six months, while the Zacks Computer - Integrated Systems industry has gained 61.4% [9] - The company reported strong fourth-quarter results, with adjusted earnings and revenues exceeding estimates, driven by growth in hybrid cloud, AI-powered automation, and enterprise consulting [9][10] - IBM is focusing on its Watsonx platform for AI capabilities and quantum technology, although it faces challenges from traditional business weaknesses and high debt levels [11] EVI Industries, Inc. (EVI) - EVI shares have outperformed the Zacks Industrial Services industry, increasing by 24.4% over the past year [12] - The company reported a 24% revenue increase in the December quarter and a 20% rise for the first six months of FY26, with gross margin expanding to approximately 31% [12][13] - Despite solid revenue growth, net income has dipped due to rising SG&A expenses, and the company faces increased working capital demands [14] Rocky Mountain Chocolate Factory, Inc. (RMCF) - Rocky Mountain shares have outperformed the Zacks Retail - Restaurants industry, gaining 51.1% over the past year [15] - The company is focusing on margin improvement, with manufacturing gross margin rising to 21.4% from 10%, and EBITDA turning positive [15][16] - However, Rocky Mountain faces liquidity risks and high-cost debt, which could impact its operational stability [17]

Core Viewpoint - EVI Industries, Inc. reported record quarterly results but experienced a significant decline in stock price, indicating a negative investor reaction despite strong financial performance [1] Financial Performance - Earnings per share for the second fiscal quarter reached 15 cents, up from 7 cents in the prior-year period [2] - Revenues increased by 24% year over year to a record $115.3 million [2] - Gross profit rose by 29% to $35.5 million, resulting in a gross margin of 30.8%, compared to 29.7% a year earlier [2] - Operating income surged by 78% year over year to $4.2 million, while net income more than doubled, increasing by 110% to $2.4 million [2] - Adjusted EBITDA for the quarter was $7.7 million, a 49% increase from $5.1 million, representing 6.6% of revenues [3] Management Commentary - CEO Henry M. Nahmad highlighted the long-term vision of transforming EVI into a national leader in the commercial laundry space, attributing success to strategic investments in people, technology, and operational efficiency [4] - The company is committed to a buy-and-build strategy, showcasing a 10-year track record of 30% compound annual revenue growth and 16% net income growth [5] - Nahmad emphasized "disciplined execution and thoughtful capital deployment," reflecting confidence in the company's scalability and resilience [5] Technology and Efficiency Initiatives - EVI reported a 13% improvement in average service response time over the past year, aided by field service technology that facilitated nearly 9,000 service appointments during the quarter [6] - The company is deploying analytics-driven inventory and procurement tools across over 15,000 SKUs to enhance demand planning and reduce order latency [7] Balance Sheet Data - As of Dec. 31, 2025, EVI reported cash of $4.3 million, down from $8.9 million as of June 30, 2025 [8] - Total assets were $315.6 million, with total liabilities of $171.7 million, including $58 million in long-term debt [8] - Shareholders' equity totaled $144 million, indicating a stable capital base amid ongoing investment and acquisition activity [8] Other Developments - EVI continues to be active in acquisitions, reinforcing its role as a consolidator in the commercial laundry distribution industry, with ongoing evaluations of additional targets and partnerships [8] - Cash flow from operations was positive at $5.1 million for the six-month period ended Dec. 31, 2025, despite a planned $12 million inventory buildup [9] - The company paid a $5 million dividend and completed the final payment on the Continental acquisition, maintaining solid liquidity and access to low-cost capital [9]

Core Insights - EVI Industries reported record results in revenue, gross profit, and operating profit for the second quarter of fiscal 2026, reflecting strong execution and enduring demand for its products and services [4][5]. Financial Performance - The company achieved over $425 million in trailing 12-month revenue for the period ending December 31, 2025, marking a significant milestone in its financial performance [5]. Operational Initiatives - EVI Industries continues to invest in modernization and optimization initiatives, which are expected to shape the long-term trajectory of the business [5].

Financial Data and Key Metrics Changes - Revenue increased 24% year-over-year to $115 million, driven primarily by contributions from acquired businesses, with legacy operations also contributing [6] - Gross margin expanded to nearly 31%, reflecting favorable product mix, pricing discipline, and benefits from strategic acquisitions [7] - Net income increased 110% to 2.1% of revenues, and Adjusted EBITDA increased 49% to $7.7 million, or 6.6% of revenue, demonstrating strong underlying operating performance [7] Business Line Data and Key Metrics Changes - The company has achieved record results in revenue, gross profit, and operating profit during the second quarter, surpassing $425 million in trailing twelve months revenue for the period ended December 31, 2025 [2][3] - The company generated compounded annual growth rates of approximately 30% in revenue, 16% in net income, and 27% in adjusted EBITDA since 2016 [3] Market Data and Key Metrics Changes - The company continues to evaluate a robust pipeline of acquisition opportunities and is pursuing strategic initiatives to expand product portfolios and deepen relationships with OEM partners [9][10] - The company is taking a broader view of growth, evaluating opportunities in and around the laundry ecosystem that can be supported by existing operations and distribution reach [10] Company Strategy and Development Direction - The company is focused on building the broadest and most flexible portfolio of products in the industry, sourced from leading OEMs, to address a full range of customer needs across all market segments [5] - Investments in people, technology, and operational capabilities are aimed at expanding competitive advantages and positioning the company for sustained growth and long-term value for shareholders [5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth strategy and the company's ability to deliver durable value for customers, employees, and shareholders [11] - The company maintains strong liquidity, solid working capital, and access to low-cost capital, providing flexibility to continue investing and pursuing disciplined growth initiatives [11] Other Important Information - Operating cash flow during the period was impacted by a planned inventory buildup of approximately $12 million to support confirmed customer sales orders [10] - The company is investing in data-driven operational systems to improve service execution and decision support, contributing to a 13% improvement in average response time over the past 12 months [8] Q&A Session Summary - No specific questions and answers were provided in the content, thus this section is not applicable.

Financial Data and Key Metrics Changes - Revenue for the second quarter increased by 24% year-over-year to $115 million, driven primarily by contributions from acquired businesses, with legacy operations also contributing [6] - Gross margin expanded to nearly 31%, reflecting favorable product mix, pricing discipline, and benefits from strategic acquisitions [6] - Net income increased by 110% to 2.1% of revenues, and Adjusted EBITDA increased by 49% to $7.7 million, or 6.6% of revenue, demonstrating strong underlying operating performance [6][7] Business Line Data and Key Metrics Changes - The company has achieved record results in revenue, gross profit, and operating profit, surpassing $425 million in trailing twelve months revenue for the period ended December 31, 2025 [2] - The six-month period saw revenue increase by 20% to more than $223 million, with gross margin remaining at 31% [7] Market Data and Key Metrics Changes - EVI has established itself as a leader in a highly fragmented industry, with compounded annual growth rates of approximately 30% in revenue, 16% in net income, and 27% in adjusted EBITDA since 2016 [3] Company Strategy and Development Direction - The company is focused on building the broadest and most flexible portfolio of products in the industry, sourced from leading OEMs, to address a full range of customer needs across all market segments [5] - Significant investments are being made in people, processes, and technology to transform the enterprise into a more scalable, integrated, and efficient organization [4][5] - The company is pursuing a balanced approach to growth, evaluating opportunities in and around the laundry ecosystem that can be supported by existing operations and relationships [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth strategy and the ongoing investments in modernization and optimization initiatives [2][11] - The company maintains strong liquidity, solid working capital, and access to low-cost capital, providing flexibility to continue investing and executing on growth strategies [11] Other Important Information - Operating margin expansion was impacted by higher operating expenses associated with investments in technology, modernization, and service capability expansion [8] - The company generated positive operating cash flow during both the 3- and 6-month periods under December 31, 2025, despite a planned inventory buildup of approximately $12 million [10] Q&A Session Summary - No specific questions and answers were provided in the content, thus this section is not applicable.

Financial Performance - Revenue increased 24% to a record $115.3 million for the second quarter, with gross profit rising 29% to $35.5 million, achieving a gross margin of 30.8%[7] - Net income surged 110% to a record $2.4 million, while adjusted EBITDA increased 49% to a record $7.7 million, representing 6.6% of revenue[7] - Revenues for the six months ended December 31, 2025, increased to $223,563,000, up 19.97% from $186,336,000 for the same period in 2024[20] - Gross profit for the six months ended December 31, 2025, was $69,422,000, representing a gross margin of 31.1%, compared to $56,377,000 and a margin of 30.2% in 2024[20] - Net income for the six months ended December 31, 2025, was $4,217,000, a decrease of 3.27% from $4,360,000 in 2024[20] - Adjusted EBITDA for the six months ended December 31, 2025, was $14,416,000, an increase of 13.09% from $12,749,000 in 2024[25] Growth Strategy - The company has achieved compounded annual growth rates of approximately 30% in revenue, 16% in net income, and 27% in adjusted EBITDA since 2016[3] - The company is pursuing a buy-and-build growth strategy, evaluating a robust pipeline of acquisition opportunities to expand its product portfolio[12] Operational Efficiency - Investments in technology and modernization initiatives have led to a 13% improvement in average service response time over the past twelve months[9] - EVI has expanded its analytics-driven inventory and procurement tools across more than 15,000 SKUs to improve operational efficiency and demand planning[11] - The company reported a consolidated operating margin expansion, although impacted by capital deployed for modernization and optimization initiatives[6] Financial Position - EVI maintains solid liquidity and strong working capital, supporting continued investment and disciplined growth initiatives despite cash flow impacts[15] - Total assets as of December 31, 2025, were $315,634,000, up from $307,028,000 as of June 30, 2025[21] - Total liabilities increased to $171,665,000 as of December 31, 2025, compared to $163,551,000 as of June 30, 2025[21] - Cash at the end of the period was $4,250,000, down from $8,852,000 at the beginning of the period[22] - Capital expenditures for the six months ended December 31, 2025, were $3,626,000, compared to $2,124,000 in 2024[22] - The company paid $4,983,000 in dividends during the six months ended December 31, 2025, compared to $4,593,000 in 2024[22] - Interest expense for the six months ended December 31, 2025, was $2,074,000, up from $1,017,000 in 2024[23] Cash Flow - Operating cash flow was impacted by a planned inventory buildup of approximately $12 million during the six-month period ended December 31, 2025[15]

Financial Performance - Revenues for the six-month period ended December 31, 2025 increased by $37.2 million, or 20%, compared to the same period in the prior fiscal year[110]. - Gross profit for the six-month period ended December 31, 2025 increased by $13.0 million, or 23%, with gross margins rising from 30.3% to 31.1%[111]. - Operating expenses increased by $12.6 million, or 26%, for the six-month period ended December 31, 2025, primarily due to expenses from acquired businesses and increased selling costs[112]. - Interest expense for the six-month period ended December 31, 2025 was $2.0 million, up from $1.2 million in the same period of the prior year[113]. - The effective tax rate decreased to 27.4% for the six-month period ended December 31, 2025, down from 30.0% in the prior year[114]. - Net income for the six-month period ended December 31, 2025 was $4.2 million, compared to $4.4 million in the same period of the prior year[115]. Assets and Liabilities - Total assets increased from $307.0 million at June 30, 2025 to $315.6 million at December 31, 2025, driven by an increase in current assets[116]. - Total liabilities rose from $163.6 million at June 30, 2025 to $171.7 million at December 31, 2025, primarily due to increases in accounts payable and long-term debt[116]. - Working capital increased from $50.6 million at June 30, 2025, to $56.1 million at December 31, 2025, primarily due to increases in inventory and other current assets[118]. Cash Flow - Cash decreased by approximately $4.6 million for the six-month period ended December 31, 2025, compared to a decrease of $0.7 million for the same period in 2024[117]. - Operating activities provided cash of $5.1 million for the six months ended December 31, 2025, an increase of $2.9 million compared to $2.2 million in 2024[120]. - Investing activities used cash of $8.3 million for the six months ended December 31, 2025, a decrease of $4.3 million compared to $12.6 million in 2024[121]. - Financing activities used cash of $1.4 million for the six months ended December 31, 2025, compared to cash provided of $9.8 million in 2024, reflecting an $11.2 million increase in cash used[122]. Borrowings and Credit - As of December 31, 2025, the Company had approximately $58.0 million of outstanding borrowings under the Credit Agreement, with a weighted average interest rate of 5.14%[124]. - The Credit Agreement allows for borrowings up to $150 million, with an accordion feature to increase the revolving credit facility by up to $50 million[123]. - A hypothetical 1% increase in daily interest rates would increase the Company's annual interest expense by approximately $580,000[133]. Strategic Initiatives - The company acquired ASN Laundry Group on August 1, 2025, which is expected to complement its existing business and provide growth opportunities[106]. - The company’s growth strategy includes a "buy-and-build" approach, focusing on acquisitions and enhancing service operations to drive market share growth[106]. Economic Factors - Inflation did not have a significant effect on the Company's results during the reported periods, but risks related to inflation and price increases remain[128]. Internal Controls - There were no changes in the Company's internal control over financial reporting during the quarter ended December 31, 2025[139]. Future Outlook - The Company believes existing cash and anticipated cash from operations will be sufficient to fund operations and capital expenditures for at least the next twelve months[127].

Core Insights - EVI Industries, Inc. (EVI) shares have declined 17.8% since the earnings report for the quarter ended September 30, 2025, underperforming the S&P 500 index, which gained 1.9% during the same period [1] - For Q1 fiscal 2026, EVI reported earnings per share of 11 cents, down from 21 cents year-over-year, while revenue increased by 16% to $108.3 million [2] - Gross profit reached a record $33.9 million, with a gross margin of 31.3%, attributed to the Continental acquisition [4] Financial Performance - Operating income fell to $3.6 million from $5 million a year ago, and net income dropped 43% to $1.8 million from $3.2 million [3] - Adjusted EBITDA decreased 11% to $6.8 million, indicating margin compression due to ongoing investments [3] - Selling, general and administrative (SG&A) expenses rose to $30.3 million from $23.9 million, impacting profitability metrics [6] Management Commentary - The CEO emphasized a long-term vision focused on acquisitions, technology upgrades, and process improvements to build a resilient business [7] - Management views current revenue gains and record gross margins as validation of its buy-and-build strategy, despite a dip in profitability [8] Business Metrics - EVI's gross margin improved to 31.3% from 30.8% year-over-year, primarily due to the Continental acquisition [4] - Adjusted EBITDA margin decreased to 6.2% from 8.1% in the comparable period, reflecting increased investments [5] Strategic Investments - The company made significant investments in consolidation and optimization, which pressured earnings, while participation in a major industry exposition elevated expenses [9] - Higher SG&A costs and increased interest expense (up to $0.9 million from $0.5 million) further squeezed profitability [10] Future Outlook - EVI reiterated confidence in sustaining gross margin improvements and pursuing additional acquisitions, supported by a robust balance sheet [11] - The company declared a special cash dividend of 33 cents per share, totaling $5 million, reflecting financial strength [12] Technological Advancements - EVI scaled its proprietary field service platform, handling approximately 9,000 service appointments in September 2025, up from 1,000 a year earlier [13] - Phase one of a new CRM system was rolled out at Continental, with plans for broader implementation to improve efficiency and sales effectiveness [13]

Financial Performance - Revenue increased 16% to a record $108 million compared to the first quarter of fiscal 2025[5] - Gross Profit increased 17% to a record $33.9 million, resulting in a gross margin of 31.3%[5] - Net Income for the quarter was $1.8 million, down from $3.2 million in the prior-year period, reflecting a net income margin of 1.7%[5] - Adjusted EBITDA was $6.8 million, or 6.2% of revenue, compared to 8.1% in the prior-year period[5] - Revenues for the three months ended September 30, 2025, increased to $108,269,000, up 15.6% from $93,625,000 for the same period in 2024[18] - Gross profit rose to $33,892,000, representing a 17.5% increase compared to $28,855,000 in the prior year[18] - Net income decreased to $1,847,000, down 42.8% from $3,231,000 year-over-year[18] - Adjusted EBITDA for the three months ended September 30, 2025, was $6,752,000, a decline of 11.2% from $7,606,000 in the same period last year[23] Acquisitions and Market Position - The Company completed four additional acquisitions, including the largest in its history, enhancing its market position[2] - The Company continues to explore qualified acquisition opportunities to capitalize on the fragmented commercial laundry market[8] Dividends and Financial Strength - The Company declared a $5.0 million special cash dividend, the largest in its history, reflecting confidence in its financial strength[6] Debt and Cash Flow - The Company’s net debt increased by $2.2 million to $46.3 million, primarily due to operating cash flow[9] - Cash at the end of the period was $4,658,000, down from $8,852,000 at the beginning of the period[20] - The company paid $1,041,000 in interest during the period, compared to $413,000 in the prior year[21] Assets and Liabilities - Total assets increased to $321,750,000 as of September 30, 2025, compared to $307,028,000 at June 30, 2025[19] - Current liabilities rose to $112,320,000, up 18.3% from $94,863,000 in the previous quarter[19] Capital Expenditures and Interest Expense - Capital expenditures for the three months ended September 30, 2025, were $1,913,000, compared to $1,253,000 in the prior year[20] - Interest expense increased to $916,000, up 90.1% from $482,000 in the same quarter last year[18] Service Capabilities - The field service platform supported approximately 9,000 appointments in September 2025, up from 1,000 a year ago, indicating significant growth in service capabilities[12]

Financial Performance - Revenues for the three-month period ended September 30, 2025 increased by $14.6 million, or 16%, compared to the same period of the prior fiscal year, primarily due to revenues from acquired businesses[107] - Gross profit for the same period increased by $5.0 million, or 17%, with gross margins rising from 30.8% to 31.3%[108] - Operating expenses increased by $6.5 million, or 27%, driven by expenses from acquired businesses and increased selling costs[109] - Net income for the three-month period was $1.8 million, down from $3.2 million, primarily due to increased operating expenses[112] Assets and Liabilities - Total assets increased from $307.0 million to $321.8 million, attributed to higher current assets and operating lease assets[113] - Total liabilities rose from $163.6 million to $181.0 million, largely due to increased accounts payable and customer deposits[113] - Working capital decreased from $50.6 million to $45.8 million, reflecting increases in accounts receivable and inventory[115] Cash Flow and Financing - For the three months ended September 30, 2025, operating activities provided cash of $1.0 million, an increase of $0.8 million compared to $0.2 million in the same period of 2024[117] - Investing activities used cash of $2.4 million for the three months ended September 30, 2025, a decrease of $4.7 million from $7.1 million used in the same period of 2024, primarily due to reduced cash paid for business acquisitions[118] - Financing activities used cash of $2.8 million for the three months ended September 30, 2025, compared to $6.7 million provided in the same period of 2024, reflecting a $9.5 million increase in cash used due to decreased net borrowings[119] - As of September 30, 2025, the Company had approximately $51.0 million of outstanding borrowings under its Credit Agreement, with a weighted average interest rate of 5.54%[121] - The Credit Agreement allows for borrowings up to $150 million, with an accordion feature to increase the facility by an additional $50 million, totaling $200 million[120] - The Company believes its existing cash, anticipated cash from operations, and funds available under the Credit Agreement will be sufficient to fund operations and capital expenditures for at least the next twelve months[124] - The Company is in compliance with its covenants under the Credit Agreement, with $48.0 million available to borrow under the revolving credit facility as of September 30, 2025[122] Special Events and Acquisitions - The company declared a special cash dividend of $0.33 per share, totaling $5.0 million, paid on October 6, 2025[113] - The company acquired ASN Laundry Group on August 1, 2025, which is expected to complement its existing business and provide growth opportunities[102] Economic Factors - Inflation did not significantly affect the Company's results during the reported periods, but risks related to inflation and price increases remain[125] - A hypothetical 1% increase in daily interest rates would increase the Company's annual interest expense by approximately $510,000 based on outstanding borrowings[130] Related Party Transactions - Payments under related party leases totaled approximately $63,000 and $57,000 for the three months ended September 30, 2025 and 2024, respectively[126]