Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the ...

Investors interested in stocks from the Chemical - Specialty sector have probably already heard of H. B. Fuller (FUL) and PPG Industries (PPG) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, an ...

In the tariff and trade pullback, we can see multiple investment opportunities come to light. These include some companies that I have never invested in before. One of these companies, and the company that I will be looking atAnalyst’s Disclosure: I/we have a beneficial long position in the shares of SXYAY, HENKY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). ...

Financial Data and Key Metrics Changes - In Q1 2025, organic revenue increased by 1.9% year on year, primarily driven by positive volume trends [9][18] - EBITDA for the quarter was $114 million, which was at the high end of guidance but declined year on year as expected, with an EBITDA margin of 14.5% [9][20] - Adjusted earnings per share (EPS) was $0.54, down compared to the same quarter in 2024 due to lower operating income [20] - Cash flow from operations decreased year on year, driven by higher working capital needs associated with revenue growth [21] Business Line Data and Key Metrics Changes - In the Hygiene, Health and Consumables (HHC) segment, organic revenue increased by 4% year on year, supported by solid volume growth and positive pricing [11] - Engineering Adhesives (EA) saw a 2% decline in organic revenue, but EBITDA increased by 16% with an EBITDA margin of 18.7% [13][14] - Building Adhesive Solutions (BAS) experienced a 2% increase in organic sales, with EBITDA also increasing by 2% year on year [15] Market Data and Key Metrics Changes - In the Americas, organic revenue decreased by 1% year on year, primarily due to declines in HHC and EA, while BAS achieved over 8% organic revenue growth [16] - In EIMIA, organic revenue increased by 4%, driven by double-digit growth in HHC [16] - Asia Pacific saw a 7% increase in organic revenue, largely attributed to strength in China [17] Company Strategy and Development Direction - The company is focused on maintaining pricing discipline, driving market share gains, and managing cost structures effectively [7][8] - A long-term strategic plan aims to optimize the portfolio mix and streamline manufacturing costs to achieve a target EBITDA margin of over 20% [8] - The company is prioritizing share buybacks in response to market volatility and has temporarily slowed the timing of M&A transactions [22][23] Management's Comments on Operating Environment and Future Outlook - Management remains cautious due to weak overall market demand and unpredictable geopolitical conditions but is confident in adapting and executing in the current environment [8][26] - The company expects to see improvements in pricing and raw material dynamics throughout the year, with a favorable net benefit anticipated [10][24] - Full-year guidance for 2025 includes a net revenue decline of 2% to 4% and adjusted EBITDA in the range of $600 million to $625 million [24][25] Other Important Information - The company has a long-term leverage target of less than three times net debt to EBITDA, with current leverage at 3.5 times [21][22] - The company is actively working on PFAS-free alternatives in adhesives, positioning itself as an innovator in this space [129] Q&A Session Summary Question: What is the current operating standpoint regarding customer management through volatility? - Management noted that customers are cautious and focused on innovation, with no significant prebuying observed [35][36] Question: Can you provide an update on market share and competitive environment? - The company has gained market share in multiple segments, particularly in HHC, and is repositioning away from lower-value products [41][42] Question: What is the outlook for pricing and EBITDA margin in HHC? - Management expects improving margins in HHC throughout the year, ideally reaching a 16% to 17% EBITDA margin range [49][52] Question: How is working capital impacting cash flow? - Working capital needs have increased due to revenue growth, but management is confident in achieving the cash flow target for the year [55][56] Question: What trends are being observed in China post-Lunar New Year? - The company is experiencing mid to high single-digit growth in China, with strong performance in both HHC and EA segments [73][74] Question: How is the solar business expected to perform? - The solar business is expected to remain weak in revenue but improve in margins as the company shifts focus to higher-efficiency applications [86][88] Question: What is the impact of tariffs on customer revenues? - The direct impact of tariffs is minimal, but durable goods production may be more affected, with potential indirect impacts on the company [123][125] Question: What is the company's position on PFAS in adhesives? - The company has introduced PFAS-free alternatives and is positioned to benefit from the market shift away from PFAS-containing materials [129][130]

First Quarter 2025 Investor Conference Call March 27, 2025 ® 2025 H.B. Fuller Title Slide Disclosure Safe Harbor Statement Certain matters discussed today are forward-looking statements within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements reflect our current expectations, and actual results may differ as they are subject to the kinds of risks that are enumerated ...

Revenue Performance - Net revenue for Q1 2025 was $788.7 million, a decrease of 2.7% compared to $810.4 million in Q1 2024[101]. - Organic revenue growth increased by 1.9% in Q1 2025, driven by a 4.2% increase in Hygiene, Health and Consumable Adhesives and a 2.2% increase in Building Adhesive Solutions[101]. - The Engineering Adhesives segment reported net revenue of $236.8 million in Q1 2025, a 4.0% increase from $226.0 million in Q1 2024[119]. - Net revenue for the Hygiene, Health and Consumable Adhesives segment was flat at $0.0 million in Q1 2025 compared to Q1 2024, with organic growth of 4.2% offset by a negative currency effect of (5.0)%[122]. - Engineering Adheses net revenue increased by 4.7% to $236.8 million in Q1 2025, driven by an 8.7% contribution from M&A, despite a decline in organic growth of (1.9)%[124]. - Building Adhesive Solutions reported a net revenue increase of 2.2% to $183.7 million in Q1 2025, with organic growth of 2.2% and a 2.4% contribution from M&A[125]. Profitability - Net income attributable to H.B. Fuller in Q1 2025 was $13.2 million, down 57.4% from $31.0 million in Q1 2024, with diluted earnings per share decreasing from $0.55 to $0.24[98][114]. - Gross profit margin decreased by 70 basis points to 28.8% in Q1 2025, primarily due to higher raw material and manufacturing costs[104]. - SG&A expenses increased by 4.8% to $180.6 million in Q1 2025, representing 22.9% of net revenue, up from 21.3% in Q1 2024[105]. - Segment operating income for Engineering Adhesives rose by 8.5% to $28.0 million, while segment operating margin improved by 40 basis points to 11.8%[124]. - Segment operating income for Building Adhesive Solutions decreased by 8.3% to $6.6 million, with segment operating margin declining by 40 basis points to 3.6%[125]. Cash Flow and Debt - Free cash flow for Q1 2025 was $(85.9) million, a significant decrease from $4.1 million in Q1 2024[138]. - Net cash provided by operating activities was $(52.9) million in Q1 2025, compared to $47.4 million in Q1 2024[140]. - Total cash and cash equivalents as of March 1, 2025, were $105.7 million, down from $165.2 million as of March 2, 2024[130]. - Total long and short-term debt increased to $2,180.0 million as of March 1, 2025, compared to $1,830.8 million as of March 2, 2024, resulting in a total debt to total capital ratio of 55.1%[130]. - Changes in net working capital resulted in a cash use of $27.5 million in Q1 2025, compared to a cash source of $34.3 million in Q1 2024[141]. Investment and Financing Activities - Net cash used in investing activities was $121.4 million in Q1 2025, up from $42.7 million in Q1 2024, with property, plant, and equipment purchases at $33.0 million[143]. - The company paid $162.0 million in cash for business acquisitions during Q1 2025 and received $75.8 million from the sale of NA Flooring[144]. - Net cash provided by financing activities was $111.4 million in Q1 2025, compared to a cash use of $16.9 million in Q1 2024[145]. - Borrowings on the revolving credit facility totaled $526.3 million in Q1 2025, with repayments amounting to $359.5 million[145]. - Cash dividends paid increased to $12.2 million in Q1 2025 from $11.2 million in Q1 2024, while common stock repurchases rose to $44.4 million from $6.2 million[145]. Other Financial Metrics - Other income, net decreased by 113.3% to $1.5 million in Q1 2025, compared to $3.2 million in Q1 2024[107]. - Interest expense slightly increased to $32.0 million in Q1 2025 from $31.9 million in Q1 2024[108]. - Income from equity method investments decreased by 50.0% to $0.5 million in Q1 2025, down from $1.0 million in Q1 2024[113]. - Trade receivables provided $13.9 million in cash in Q1 2025, down from $56.9 million in Q1 2024, with Days Sales Outstanding (DSO) increasing to 61 days[142]. - Inventory usage decreased to $27.1 million in Q1 2025 from $50.2 million in Q1 2024, with inventory days on hand at 79 days[142]. - Trade payables resulted in a cash use of $14.3 million in Q1 2025, compared to a cash source of $27.6 million in Q1 2024, with Days Payable Outstanding remaining at 73 days[142]. Restructuring and Market Risks - Restructuring plans are expected to incur costs of approximately $60.0 million to $65.0 million, with $61.7 million already incurred as of March 1, 2025[99]. - The company remains exposed to market risks including interest rates and foreign currency rates, with no material changes reported since November 30, 2024[149].

H.B. Fuller Company (FUL) Q1 2025 Earnings Call March 27, 2025 10:30 AM ET Company Participants Steven Brazones - Investor RelationsCeleste Mastin - President & Chief Executive OfficerJohn Corkrean - Executive VP & CFOKevin McCarthy - PartnerDavid Begleiter - Managing DirectorRachel Lee - Equity Research AssociateRosemarie Morbelli - Portfolio Manager Conference Call Participants Ghansham Panjabi - Senior Research AnalystMichael Harrison - Managing Director and Senior Chemicals AnalystJeffrey Zekauskas - An ...

H.B. Fuller Company (FUL) Q1 2025 Earnings Call March 27, 2025 10:30 AM ET Company Participants Steven Brazones - Investor RelationsCeleste Mastin - President & Chief Executive OfficerJohn Corkrean - Executive VP & CFOKevin McCarthy - PartnerDavid Begleiter - Managing DirectorRachel Lee - Equity Research AssociateRosemarie Morbelli - Portfolio Manager Conference Call Participants Ghansham Panjabi - Senior Research AnalystMichael Harrison - Managing Director and Senior Chemicals AnalystJeffrey Zekauskas - An ...

H. B. Fuller Company (FUL) Q1 2025 Earnings Conference Call March 27, 2025 10:30 AM ET Company Participants Operator - Conference Call OperatorSteve Prezant - Call ModeratorCeleste Mastin - President and Chief Executive OfficerJohn Corcoran - Executive Vice President and Chief Financial OfficerKancham Punjabi - Questioner (Beard)Kevin McCarty - Questioner (Vertical Research Partners)David Biglager - Questioner (Deutsche Bank)Mike Harrison - Questioner (Seaport Research Partners)Jeff Sikowskas - Questioner ( ...

Financial Performance - Net revenue for Q1 2025 was $789 million, a decrease of 2.7% year-on-year; organic revenue increased by 1.9% driven by a 1.7% volume increase[5]. - Adjusted EBITDA for Q1 2025 was $114 million, down 7% year-on-year, primarily due to higher raw material costs and variable compensation[9]. - Adjusted EPS (diluted) for Q1 2025 was $0.54, compared to $0.55 in Q1 2024, reflecting a decrease in net income attributable to H.B. Fuller of $13 million[9]. - The gross margin for Q1 2025 was 28.8%, with an adjusted gross margin of 29.6%, down 50 basis points year-on-year due to increased raw material costs[7]. - Net income attributable to H.B. Fuller for the three months ended March 1, 2025, was $13,248, compared to $30,991 for the same period in 2024, representing a decline of 57.3%[26]. - Adjusted net income attributable to H.B. Fuller decreased to $29,997 from $37,692 year-over-year, a reduction of 20.5%[26]. - Revenue for the three months ended March 1, 2025, was $788,663, down from $810,419 in the prior year, reflecting a decrease of 2.5%[32]. - Adjusted EBITDA for the same period was $114,356, compared to $123,018 in 2024, indicating a decline of 7.1%[32]. - The adjusted EBITDA margin decreased to 14.5% from 15.2% year-over-year[32]. - H.B. Fuller reported a net income attributable to the company of $70,315,000 for the three months ended March 1, 2025, compared to $84,331,000 for the same period in 2024, reflecting a decrease of approximately 16.6%[44]. - The total revenue for H.B. Fuller was $788,663,000 for the three months ended March 1, 2025, a decline of 2.7% compared to the previous year[50]. - Organic growth for H.B. Fuller was reported at 1.9%, while the impact of foreign exchange (F/X) was a decline of 3.4%[50]. - The Hygiene, Health and Consumable Adhesives segment experienced a revenue growth of 4.2% on an organic basis, while Engineering Adhesives saw a decline of 1.9%[50]. Shareholder Returns - The company repurchased 678 thousand shares during the quarter, reflecting a commitment to returning value to shareholders[6]. Future Projections - For fiscal 2025, net revenue growth is expected to decline by 2% to 4%, while organic revenue growth is projected to be flat to up 2%[16]. - Adjusted EBITDA for fiscal 2025 is anticipated to be in the range of $600 million to $625 million, representing a year-on-year growth of approximately 1% to 5%[16]. Debt and Cash Flow - Net debt at the end of Q1 2025 was $2,074 million, an increase of $233 million sequentially and $409 million year-on-year, primarily driven by acquisitions[11]. - Cash flow from operations is expected to be weighted towards the second half of 2025 due to higher working capital needs associated with revenue growth[13]. - Total debt as of March 1, 2025, is $2,179,997, an increase from $2,010,639 as of November 30, 2024[60]. - Net debt as of March 1, 2025, is $2,074,254, compared to $1,841,287 as of November 30, 2024, reflecting a significant increase[60]. - Cash and cash equivalents decreased to $105,743 as of March 1, 2025, from $169,352 as of November 30, 2024[64]. - Net cash used in operating activities for the three months ended March 1, 2025, is $(52,907), compared to $47,351 for the same period in 2024[66]. Operational Costs - Acquisition project costs for the quarter amounted to $9,828,000, and organizational realignment costs were $8,774,000[44]. - The company incurred interest expenses of $32,030,000 during the quarter, contributing to the overall financial adjustments[44]. Segment Performance - Segment revenue for Hygiene, Health and Consumable Adhesives was $368,225, slightly up from $368,078, while Engineering Adhesives increased to $236,758 from $226,075[32]. - Total segment operating income decreased to $46,447 from $66,875, a decline of 30.6%[32]. - The gross profit margin for the three months ended March 1, 2025, was 28.8%, down from 29.5% in the prior year[39]. - Adjusted gross profit margin decreased to 29.6% from 30.1% year-over-year[39]. - The revenue for the Building Adhesive Solutions segment was $179,666,000, with an adjusted EBITDA of $21,410,000[47]. Investments - The company has made significant investments, with $162,032 used for purchased businesses in the three months ended March 1, 2025[66].