Group 1: Hawkins (HWKN) - Hawkins distributes, blends, and manufactures bulk and specialty chemicals and health and nutrition products across various industries [1] - The company has a Zacks Rank of 1 (Strong Buy) and a 0.9% increase in the Zacks Consensus Estimate for current year earnings over the last 60 days [1] - Hawkins' shares increased by 35.3% over the last three months, outperforming the S&P 500's gain of 7.9%, and holds a Momentum Score of A [2] Group 2: Talen Energy Corporation (TLN) - Talen Energy owns and operates power infrastructure primarily in the United States [2] - The company has a Zacks Rank of 1 and a 7.6% increase in the Zacks Consensus Estimate for current year earnings over the last 60 days [2] - Talen Energy's shares gained 52.6% over the last three months, significantly exceeding the S&P 500's gain of 7.9%, and has a Momentum Score of B [3] Group 3: Magic Software Enterprises (MGIC) - Magic Software develops, markets, and supports software development and deployment technology for enterprises [4] - The company has a Zacks Rank of 1 and a 10.1% increase in the Zacks Consensus Estimate for current year earnings over the last 60 days [4] - Magic Software's shares rose by 28.3% over the last three months, again outperforming the S&P 500's gain of 7.9%, and holds a Momentum Score of B [5]

Core Insights - Hawkins (NASDAQ: HWKN) has experienced nearly 70% capital gains in less than six months, despite previous assessments indicating it was too expensive [1]. Group 1: Company Performance - Hawkins has shown significant growth in its stock value, indicating strong market performance [1]. Group 2: Investment Opportunities - The investing group "Value In Corporate Events" focuses on identifying opportunities in IPOs, mergers & acquisitions, earnings reports, and corporate capital allocation changes, covering 10 major events monthly [1].

Company Overview - Hawkins, Inc. is a leading water treatment and specialty ingredients company founded in 1938, headquartered in Roseville, Minnesota [3] - The company operates 64 facilities across 28 states and employs approximately 1,100 people [3] - In fiscal 2025, Hawkins, Inc. generated $974 million in revenue [3] Upcoming Conference Participation - The company will participate in Seaport Research Partners' 14th Annual Summer Investor Conference, which will be held virtually from August 19 to August 20, 2025 [2] - CEO Patrick Hawkins and CFO Jeff Oldenkamp will represent the company, with Hawkins scheduled to speak on August 20, 2025 [1][2] - The conference is expected to attract over 500 institutional buy-side investors and will include one-on-one and small group meetings [2]

Core Insights - FUCHS SE - Unsponsored ADR (FUPBY) is currently viewed as a more attractive investment option compared to Hawkins (HWKN) based on various valuation metrics and earnings outlook [3][7]. Valuation Metrics - FUPBY has a forward P/E ratio of 16.92, significantly lower than HWKN's forward P/E of 36.97, indicating that FUPBY may be undervalued [5]. - The PEG ratio for FUPBY is 1.95, while HWKN's PEG ratio stands at 2.70, suggesting that FUPBY offers better value relative to its expected earnings growth [5]. - FUPBY's P/B ratio is 3.12, compared to HWKN's P/B of 6.84, further highlighting FUPBY's more favorable valuation [6]. Earnings Outlook - FUPBY has experienced stronger estimate revision activity, which is a positive indicator for its earnings outlook compared to HWKN [7]. Value Grades - FUPBY has received a Value grade of B, while HWKN has a Value grade of D, reflecting the overall assessment of their valuation metrics [6].

Core Insights - Hawkins reported record GAAP revenue and gross profit for Q1 FY2026, but fell short of analyst expectations for both revenue and earnings per share [1][2] - Actual GAAP revenue was $293.3 million, below the consensus estimate of $302.3 million, while GAAP earnings per share were $1.40 compared to the estimated $1.45 [1][2] - The company achieved a 15% year-over-year increase in GAAP revenue, with the Water Treatment segment being a key growth driver [1][5] Financial Performance - Q1 FY2026 GAAP revenue was $293.3 million, a 14.6% increase from $255.9 million in Q1 FY2025 [2] - GAAP earnings per share were $1.40, reflecting a 1.4% increase from $1.38 in the same quarter last year [2] - Adjusted EBITDA rose 13.2% to $57.6 million, while gross profit increased by 11.9% to $72.4 million [2][8] - Net income for the quarter was $29.2 million, a slight increase of 1.0% from $28.9 million in Q1 FY2025 [2] Business Segments Overview - The Water Treatment segment led growth with sales increasing 28% year-over-year to $149.6 million, driven by the WaterSurplus acquisition [5][6] - The Food & Health Sciences segment reported GAAP revenue of $89.2 million, up 5% year-over-year, but gross profit fell 3% due to competitive pricing pressures [6] - Industrial Solutions saw modest revenue growth of 2%, reaching $54.5 million, but faced profitability pressures with operating income declining [7] Strategic Focus and Future Outlook - Hawkins is focusing on the Water Treatment segment, pursuing acquisitions to enhance operations and capture higher-margin business [4] - The company expects all segments to achieve profitable growth in FY2026 but did not provide specific revenue or profit guidance [10] - Management anticipates an effective annual tax rate of 26% to 27% for FY2026 [10]

分组1 - Hawkins reported quarterly earnings of $1.4 per share, exceeding the Zacks Consensus Estimate of $1.33 per share, and showing a slight decrease from $1.38 per share a year ago, resulting in an earnings surprise of +5.26% [1] - The company achieved revenues of $293.27 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.38% and increasing from $255.88 million year-over-year [2] - Hawkins shares have increased approximately 30.9% year-to-date, significantly outperforming the S&P 500's gain of 8.3% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $1.19 on revenues of $278.75 million, while for the current fiscal year, the estimate is $4.28 on revenues of $1.08 billion [7] - The Zacks Industry Rank indicates that the Chemical - Specialty sector is currently in the bottom 32% of over 250 Zacks industries, suggesting potential challenges for stock performance [8] 分组3 - The estimate revisions trend for Hawkins was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

PART I. FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company's Q1 FY2026 financial statements reflect significant growth in assets and liabilities due to acquisitions, with sales up 15% to $293.3 million and net income at $29.2 million [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to **$988.3 million** driven by acquisitions, while liabilities rose to **$503.7 million** due to increased long-term debt Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 29, 2025 | March 30, 2025 | Change | | :--- | :--- | :--- | :--- | | **Total Assets** | **$988,274** | **$769,867** | **+28.4%** | | Goodwill | $218,899 | $135,409 | +61.7% | | Intangible assets, net | $239,975 | $150,121 | +59.9% | | **Total Liabilities** | **$503,702** | **$309,575** | **+62.7%** | | Long-term debt, less current portion | $288,281 | $138,906 | +107.5% | | **Total Shareholders' Equity** | **$484,572** | **$460,292** | **+5.3%** | [Condensed Consolidated Statements of Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Sales increased **14.6%** to **$293.3 million**, but operating income growth was limited to **3.9%** due to higher SG&A expenses Quarterly Income Statement Highlights (in thousands, except per-share data) | Metric | Q1 FY2026 (ended June 29, 2025) | Q1 FY2025 (ended June 30, 2024) | YoY Change | | :--- | :--- | :--- | :--- | | Sales | $293,272 | $255,879 | +14.6% | | Gross Profit | $72,362 | $64,655 | +11.9% | | Operating Income | $41,333 | $39,791 | +3.9% | | Net Income | $29,175 | $28,879 | +1.0% | | Diluted EPS | $1.40 | $1.38 | +1.4% | | Cash Dividends per Share | $0.18 | $0.16 | +12.5% | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased to **$31.5 million**, while investing activities used **$164.5 million** primarily for acquisitions, funded by **$142.5 million** in financing Quarterly Cash Flow Summary (in thousands) | Activity | Three Months Ended June 29, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $31,490 | $17,586 | | Net cash used in investing activities | ($164,545) | ($35,804) | | - Acquisitions | ($151,328) | ($25,400) | | Net cash provided by financing activities | $142,454 | $19,952 | | - Proceeds from revolving loan borrowings | $160,000 | $45,000 | | **Net Increase in Cash** | **$9,399** | **$1,734** | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail segment realignment, the **$149.9 million** WaterSurplus acquisition, and the **$400 million** credit facility expansion to fund growth - Effective Q1 FY2026, the company realigned its reporting segments to Water Treatment, Food & Health Sciences, and Industrial Solutions to better reflect its business operations[16](index=16&type=chunk)[53](index=53&type=chunk) - On April 25, 2025, the company acquired WaterSurplus for an initial purchase price of approximately **$149.9 million**, plus a potential earnout of up to **$53.7 million**, adding **$82.7 million** to goodwill and **$94.0 million** to identifiable intangible assets[21](index=21&type=chunk) - To fund the WaterSurplus acquisition, the company amended its credit agreement, increasing the senior secured revolving credit facility to **$400.0 million**, maturing on April 25, 2030[43](index=43&type=chunk)[44](index=44&type=chunk) Goodwill by Segment (in thousands) | Segment | Balance at March 30, 2025 | Addition due to acquisitions | Balance at June 29, 2025 | | :--- | :--- | :--- | :--- | | Water Treatment | $83,968 | $83,490 | $167,458 | | Food & Health Sciences | $46,149 | — | $46,149 | | Industrial Solutions | $5,292 | — | $5,292 | | **Total** | **$135,409** | **$83,490** | **$218,899** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses **15%** sales growth driven by acquisitions, limited operating income growth due to higher SG&A, and strong liquidity from an expanded **$400 million** credit facility [Business Acquisitions](index=20&type=section&id=Business%20Acquisitions) The company completed six acquisitions in fiscal 2025 and Q1 FY2026, primarily in Water Treatment, with WaterSurplus being the largest at **~$149.9 million** - Completed six acquisitions in fiscal 2025 and Q1 fiscal 2026, with an aggregate annual revenue of approximately **$102 million**, all within the Water Treatment segment[62](index=62&type=chunk)[63](index=63&type=chunk) - Key acquisitions include WaterSurplus for **~$149.9 million**, Amerochem for **$44.0 million**, and Intercoastal for **$22.0 million**[67](index=67&type=chunk) [Results of Operations](index=21&type=section&id=Results%20of%20Operations) Total sales increased **15%** to **$293.3 million**, led by Water Treatment's **28%** growth, while gross margin declined and SG&A expenses rose **24%** Segment Sales Performance (YoY) | Segment | Q1 FY2026 Sales | YoY Change | | :--- | :--- | :--- | | Water Treatment | $149.6M | +28% | | Food & Health Sciences | $89.2M | +5% | | Industrial Solutions | $54.5M | +2% | | **Total** | **$293.3M** | **+15%** | - Gross profit increased by **$7.7 million (12%)**, but gross margin as a percentage of sales slightly declined to **24.7%** from **25.3%** in the prior year[75](index=75&type=chunk) - SG&A expenses rose by **$6.1 million (24%)**, largely due to **$4.9 million** in added costs from acquired businesses, including **$2.0 million** in amortization and **$0.9 million** in acquisition costs[79](index=79&type=chunk) [Liquidity and Capital Resources](index=23&type=section&id=Liquidity%20and%20Capital%20Resources) Cash increased by **$9.4 million** to **$14.5 million**, with **$31.5 million** from operations and **$150.0 million** net borrowings from the expanded **$400 million** credit facility - Cash provided by operations was **$31.5 million**, a significant increase from **$17.6 million** in the prior-year period[85](index=85&type=chunk) - Net borrowings were **$150.0 million**, primarily to fund the acquisition of WaterSurplus[87](index=87&type=chunk) - The company did not repurchase any common stock during the quarter ended June 29, 2025[87](index=87&type=chunk)[89](index=89&type=chunk) - The revolving credit facility was increased to **$400.0 million** and matures on April 25, 2030, with the company in compliance with all debt covenants as of June 29, 2025[90](index=90&type=chunk)[95](index=95&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces commodity price and interest rate risks, mitigating the latter with a **$60 million** interest rate swap, with minimal foreign currency exposure - The company is subject to risk from commodity chemical price volatility but attempts to pass cost changes to customers[101](index=101&type=chunk) - To manage interest rate risk on its variable-rate debt, the company uses a **$60.0 million** interest rate swap agreement that terminates on May 1, 2027[102](index=102&type=chunk) - A hypothetical **25-basis point** change in interest rates on unhedged variable-rate debt would change annual interest expense by about **$0.1 million**[102](index=102&type=chunk) [Controls and Procedures](index=25&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 29, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period, June 29, 2025[104](index=104&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[105](index=105&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=26&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material pending legal proceedings beyond routine litigation incidental to its business - There are no material pending legal proceedings to which the company is a party[107](index=107&type=chunk) [Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's risk factors have been reported from the fiscal 2025 Form 10-K disclosure - No material changes to risk factors from the fiscal 2025 Form 10-K have been reported[108](index=108&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=26&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No shares were repurchased under the plan this quarter, with **731,544** shares remaining available for future repurchases - No shares were repurchased under the company's publicly announced plan during the quarter[109](index=109&type=chunk) - A total of **731,544** shares remain available for repurchase under the existing program as of June 29, 2025[109](index=109&type=chunk) [Exhibits](index=27&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including CEO/CFO certifications and the amended credit agreement incorporated by reference - Exhibits filed include CEO and CFO certifications (31.1, 31.2, 32.1, 32.2) and the iXBRL formatted financial statements (101)[113](index=113&type=chunk) - The Joinder, Consent and Second Amendment to the Credit Agreement dated April 25, 2025, is incorporated by reference[113](index=113&type=chunk)[114](index=114&type=chunk)

Financial Performance - Hawkins' 2025 revenue reached $9744 million[10] - The company's 5-year EPS CAGR is 25%[10] - Net income in fiscal year 2025 was $843 million, with a 24% CAGR[67] - Adjusted EBITDA in fiscal year 2025 was $1675 million, with a 21% CAGR[69] - Diluted EPS in fiscal year 2025 was $403, with a 25% CAGR[74] - Q1 Fiscal Year 2026 revenue reached a record $2933 million, a 15% increase year-over-year[81] - Q1 Fiscal Year 2026 Adjusted EBITDA reached a record $574 million, a 13% increase year-over-year[81] Business Segments - Water Treatment accounted for 46% of revenue, totaling $4465 million[15] - Food & Health Sciences accounted for 33% of revenue, totaling $3225 million[15] - Industrial Solutions accounted for 21% of revenue, totaling $2054 million[15] Capital Allocation - The company has consistently returned capital to shareholders through dividends and share repurchases[32] - Hawkins has a track record of 40 consecutive years of cash dividends[33]

Core Insights - Hawkins, Inc. reported record revenue of $293 million for the first quarter of fiscal 2026, marking a 15% increase year-over-year, with all three reporting segments contributing to this growth [3][6][7] - The Water Treatment segment experienced significant growth, with a 28% increase in sales, driven by both acquired businesses and improved pricing [3][8] - The company successfully completed the acquisition of WaterSurplus, enhancing its capabilities in water treatment and positioning for future growth [3][6][19] Financial Performance - Net income for the first quarter was $29.2 million, or $1.40 per diluted share, compared to $28.9 million, or $1.38 per diluted share in the prior year [5][6] - Adjusted EBITDA increased by 13% to $57.6 million, with trailing twelve-month adjusted EBITDA exceeding $170 million [6][17] - Gross profit rose by 12% to $72.4 million, maintaining a gross margin of 25% [6][11] Segment Performance - Water Treatment segment sales increased by $32.4 million, or 28%, to $149.6 million [8][32] - Food & Health Sciences segment sales grew by $4.1 million, or 5%, to $89.2 million, with agricultural products driving the increase despite competitive pricing pressures [9][32] - Industrial Solutions segment sales saw a modest increase of $0.9 million, or 2%, to $54.5 million, primarily due to higher sales volumes [10][32] Expenses and Balance Sheet - Selling, general and administrative expenses rose by 24% to $31 million, largely due to costs associated with the WaterSurplus acquisition [15][32] - The company's leverage ratio at the end of the first quarter was 1.6x, reflecting a strong balance sheet despite increased debt from the acquisition [3][19] - Working capital increased by $22 million compared to the end of fiscal 2025, driven by higher inventories and receivables [19][27]

Hawkins, Inc. was founded in 1938 and is a leading water treatment and specialty ingredients company that formulates, manufactures, distributes and blends products for its Water Treatment, Food & Health Sciences and Industrial Solutions customers. Headquartered in Roseville, Minnesota, the Company has 64 facilities in 28 states and creates value for its customers through superb customer service and support, quality products and personalized applications. Hawkins, Inc. generated $974 million of revenue in fi ...