Core Insights - The Toro Company reported fourth-quarter fiscal 2024 results with both revenues and earnings falling short of the Zacks Consensus Estimate, although both metrics improved compared to the same quarter last year [1][4][5] Financial Performance - Adjusted earnings were reported at 95 cents per share, slightly below the consensus estimate of 96 cents, but up from 71 cents in the prior year [4] - Net sales reached $1,076 million, missing the consensus estimate of $1,086 million, but reflecting a 9.4% increase year-over-year [5] - Adjusted gross profit increased by 5.1% year-over-year to $347.8 million, while gross margin contracted by 130 basis points to 32.3% due to rising costs [6] - SG&A expenses improved by 2.1% year-over-year to $240 million, with a decrease in this metric as a percentage of net sales by 160 basis points to 22.3% [7] - Adjusted operating earnings were $117 million, compared to $99.5 million in the same quarter last year, with an adjusted operating margin of 10.9%, up 80 basis points year-over-year [8] Segment Performance - Professional segment net sales were $913.9 million, a 10.3% increase from $828.9 million in the prior year, driven by higher shipments of golf and grounds products [9] - Residential segment net sales reached $155.1 million, a 4.5% increase from $148.4 million in the previous year, supported by greater shipments of lawn care products [10] Financial Position - As of the end of the fiscal fourth quarter, the company had cash and cash equivalents of $199.5 million, long-term debt of $911.8 million, and shareholders' equity of $1.55 billion [12] - Net inventories declined by 4.5% year-over-year, with net cash provided by operating activities at $569.9 million and free cash flow at $470.7 million [12] Future Outlook - For fiscal 2025, the company projects net sales growth of 0% to 1% and adjusted EPS between $4.25 and $4.40, supported by strong demand in underground construction and golf segments [13]

Core Viewpoint - Toro (TTC) reported quarterly earnings of $0.95 per share, slightly missing the Zacks Consensus Estimate of $0.96 per share, but showing an increase from $0.71 per share a year ago, indicating a year-over-year growth in earnings despite the miss [1][2] Financial Performance - The company posted revenues of $1.08 billion for the quarter ended October 2024, which was below the Zacks Consensus Estimate by 0.94%, but up from $983.2 million in the same quarter last year, reflecting a year-over-year revenue growth [2] - Over the last four quarters, Toro has surpassed consensus EPS estimates only once, indicating mixed performance in earnings expectations [2][7] Stock Performance - Toro shares have declined approximately 11.1% since the beginning of the year, contrasting with the S&P 500's gain of 26.9%, highlighting underperformance relative to the broader market [4] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.82 on revenues of $1.08 billion, while for the current fiscal year, the estimate is $4.59 on revenues of $4.77 billion, suggesting cautious expectations moving forward [8] - The Zacks Rank for Toro is currently 3 (Hold), indicating that the stock is expected to perform in line with the market in the near future [7] Industry Context - The Tools - Handheld industry, to which Toro belongs, is currently ranked in the top 2% of over 250 Zacks industries, suggesting a favorable industry outlook that could positively influence Toro's performance [9]

Core Viewpoint - Toro Corp. has announced a $100 million senior term loan facility to Castor Maritime Inc., secured by 10 vessels valued at approximately $235 million, with a tenor of 5 years and an interest rate of SOFR plus 1.80% per annum [1] - Additionally, Toro is increasing its investment in Castor's Series D Preferred Shares by 50,000 shares for a total of $50 million, bringing its total holdings to 100,000 shares [2] Group 1: Financial Transactions - The $100 million term loan facility is secured by 10 vessels owned by Castor, which are valued at around $235 million based on third-party valuations [1] - The term loan has a duration of 5 years and an interest rate of SOFR plus 1.80% per annum [1] - Toro is investing an additional $50 million in Castor's 5.00% Series D cumulative perpetual convertible preferred shares, increasing its total holdings to 100,000 shares [2] Group 2: Company Background - Toro Corp. is an international energy transportation services company with a fleet that includes tankers and LPG carriers, currently owning five vessels with a total capacity of 0.1 million deadweight tons [5] - Castor Maritime Inc. is a Nasdaq-listed maritime entity controlled by Petros Panagiotidis, who is also the CEO of Toro [3]

Financial Performance - Total revenues for the nine months ended September 30, 2024, were $17.2 million, up from $15.0 million for the same period in 2023, indicating an increase of 14.5%[7] - Operating loss for the nine months ended September 30, 2024, was $3.8 million, compared to an operating income of $444,119 for the same period in 2023[7] - Net income attributable to common shareholders decreased from $109.9 million in the nine months ended September 30, 2023, to $20.9 million in 2024, a decline of 81%[7] - Net income for the nine months ended September 30, 2023, was $112,410,345, while for the same period in 2024, it decreased to $24,229,477[12] - For the nine months ended September 30, 2024, the Company reported net income of $24,229,477, a decrease of 78.5% compared to $112,410,345 for the same period in 2023[84] Assets and Liabilities - Total assets increased from $308.1 million as of December 31, 2023, to $325.4 million as of September 30, 2024, representing a growth of 5.4%[5] - Cash and cash equivalents rose from $151.8 million as of December 31, 2023, to $192.1 million as of September 30, 2024, an increase of 26.6%[5] - Total current liabilities decreased from $7.9 million as of December 31, 2023, to $5.3 million as of September 30, 2024, a reduction of 32.5%[5] - Total shareholders' equity as of September 30, 2023, was $140,582,168, which increased to $198,258,065 by the end of 2024[10] - Total assets from continuing operations increased from $285,301,738 as of December 31, 2023, to $324,492,665 as of September 30, 2024, reflecting a growth of approximately 13.7%[98] Cash Flow - Cash provided by operating activities from continuing operations increased from $5,308,976 in 2023 to $13,509,080 in 2024[12] - Cash, cash equivalents, and restricted cash at the end of the period increased from $103,479,350 in 2023 to $192,139,107 in 2024[12] Shareholder Actions - The company issued 8,500,000 common shares in a private placement, raising $18,647,236[12] - The company repurchased common shares costing $3,728,008 in 2024[12] - The Company repurchased a total of 867,156 common shares at an average price of $5.50 per share under its share repurchase program[62] - The Company paid a dividend amounting to $1,050,000 on the Series A Preferred Shares for the period from October 15, 2023, to July 14, 2024[65] - The company paid a dividend of $350,000 on Series A Preferred Shares for the period from July 15, 2024, to October 14, 2024[98] Operational Changes - The Company has classified the disposal of its Aframax/LR2 vessels as discontinued operations, significantly affecting its financial results[31] - The Company established its LPG carrier operations in Q2 2023, operating in two reportable segments: Handysize tanker and LPG carrier as of Q2 2024[94] Expenses - The total expenses for the nine months ended September 30, 2023, were $58,479,445, while they decreased to $19,124,183 in 2024[33] - Depreciation and amortization expenses increased from $2,195,236 in 2023 to $3,591,785 in 2024[12] - The company incurred voyage expenses of $1,299,007 for the nine months ended September 30, 2024, compared to $1,083,502 in 2023, representing an increase of approximately 19.9%[95] Investments - The company reported interest income of $6.6 million for the nine months ended September 30, 2024, compared to $1.1 million for the same period in 2023, a significant increase of 484%[7] - The company’s investment in equity securities increased from $0 to $2.5 million from December 31, 2023, to September 30, 2024[5] - The Company agreed to purchase 50,000 Series D Cumulative Perpetual Convertible Preferred Shares of Castor for an aggregate cash consideration of $50.0 million, with a distribution rate of 5.00% per annum[43] - As of September 30, 2024, the aggregate value of the investment in Castor amounted to $50,569,444, including $569,444 of accrued dividends[47] Segment Performance - Total vessel revenues for the nine months ended September 30, 2023, were $51,537,266, compared to $631,082 for the same period in 2024, indicating a significant decline[33] - The Handysize tanker segment reported total revenues of $10,394,268 for the nine months ended September 30, 2024, compared to $605,850 in 2023, indicating a significant increase[95] - Time charter revenues significantly increased to $10,394,268 for the nine months ended September 30, 2024, compared to $605,850 for the same period in 2023, marking a growth of 1611.5%[85] Accounting and Reporting - The Company’s financial statements are prepared in accordance with U.S. GAAP and do not include all information required for complete financial statements[23] - The results of operations for interim periods are not necessarily indicative of the results expected for the entire year[24] - The Company has adopted new accounting policies for measuring equity securities at fair value, with changes recognized through net income[26] - The Company’s unaudited interim condensed consolidated financial statements include all necessary adjustments for fair presentation[24]

Company Overview - The Toro Company (NYSE:TTC) specializes in lawn care products and solutions, operating in two segments: professional and residential [2] - The company has a market capitalization of approximately $8.5 billion and has delivered nearly 8,500% return since its public offering [2] Financial Performance - Revenue per share has grown at an 8.6% CAGR over the past ten fiscal years, with notable increases in 2019, 2021, and 2022, all exceeding 15% [3] - In fiscal 2023, revenue per share saw only a minor increase, prompting attention on fiscal 2024 for potential recovery [3] - Gross profit margin fluctuated but returned close to 35% in 2023 after a decline [3] - Return on invested capital (ROIC) has decreased from pre-pandemic levels near 30% to 18.7% in 2023 [3] Dividend Information - Toro has paid dividends for over 30 years, with a current quarterly dividend of $0.36, yielding about 1.75% [4] - The company has a strong commitment to dividend growth, with 3-, 5-, and 10-year growth rates all exceeding 10% [4] Earnings Update - For Q3, Toro reported revenue of $1.16 billion, a nearly 7% increase year-over-year, but missed analyst expectations by over $100 million [6] - Adjusted EPS for the quarter was $1.18, up more than 24% from the previous year, but also fell short of estimates [6] - The Professional segment experienced a slight sales decline of 1.7%, while the Residential segment saw revenue increase by over 50% [6] Valuation - Toro's stock is currently trading at about $83, below its fair value estimate of $108, indicating a potential buying opportunity [8] - The expected rate of return for Toro is just above 16%, driven by anticipated earnings growth and dividend yield [8] - The valuation model suggests that Toro is trading slightly below fair value, with a recent drop in stock price providing a better margin of safety for investors [7][8]

Core Points - Toro Corp. held its 2024 Annual General Meeting of Shareholders on September 6, 2024, in Limassol, Cyprus [1] - The meeting resulted in the re-election of Mr. Petros Zavakopoulos as Class A Director until the 2027 Annual General Meeting [1] - Deloitte Certified Public Accountants S.A. was appointed as the independent auditors for the fiscal year 2024 [1] Company Overview - Toro Corp. is an international energy transportation services company specializing in the transportation of crude oil, petroleum products, and petrochemical gases [2] - The company operates a fleet of five vessels with a total capacity of 0.1 million deadweight tons (dwt), including one Handysize tanker and four 5,000 cubic meter (cbm) LPG carriers [2]

Core Viewpoint - Toro Company continues to face challenges in consumer demand for lawn care and landscaping equipment, resulting in stock price fluctuations within the $80-$100 range since Q3 2023 earnings report [2][3][18] Financial Performance - In Q3 2024, Toro reported adjusted EPS of $1.18, an improvement from $0.95 a year ago, but below the management's expectations of surpassing the previous record of $1.19 [4] - Full-year guidance for FY 2024 has been revised down, with expected sales growth of only 1% and EPS projected in the range of $4.15-$4.20, down from last year's $4.21 [4][15] - The residential segment showed strong performance with a 52.6% increase in sales and an operating margin of 12.2% [4] Market Dynamics - The professional segment, which constitutes about 75% of Toro's sales, experienced a slight year-on-year decline, although not as severe as previous quarters [5] - There is a backlog of orders in the golf and grounds and underground construction markets, but overall growth remains sluggish [5][6] Inventory Management - Toro is making progress in reducing high dealer inventories, with days sales outstanding (DSO) improving from 200 days to 119 days in Q3 2024 [7][8] - The company is approximately 80% of the way back to normal inventory levels, indicating a positive trend in inventory management [8][12] Capital Management - Toro's free cash flow (FCF) conversion is improving, currently at 82% of net income, with expectations of achieving at least 100% FCF conversion for the full year [13][15] - The company has paid off $40 million in debt, repurchased $109 million in stock, and paid $113 million in dividends so far this year [15] Valuation - Toro's stock is currently trading at a PE ratio of 19.6 times 2024 earnings, which is near the bottom of its 10-year historical range [16] - Given the slowdown in growth and reduced guidance, a PE of 20 appears fair, with a price target of $83.50 based on the midpoint of company guidance [17]

Core Insights - Toro's latest quarterly results fell short of expectations, leading to a significant drop in share price [1][2] - The company reported earnings of $1.18 per share on sales of $1.16 billion, missing Wall Street's estimates of $1.18 per share and $1.26 billion in sales [2] - Toro has lowered its full-year earnings guidance to a range of $4.15 to $4.20 per share, down from previous guidance of $4.25 to $4.35, while Wall Street had expected $4.30 per share [2] Industry Context - The operating environment for Toro is challenging, with macroeconomic concerns impacting demand for lawn care equipment [1][3] - Despite strong demand in the professional segment, including underground construction and golf course equipment, the lawn care segment is expected to face continued caution due to macro uncertainty [3] - Higher interest rates and economic uncertainty are negatively affecting housing sales, which in turn impacts demand for lawn care equipment [3] Company Outlook - Toro has resolved excess inventory issues that affected previous quarters, which could lead to a quick turnaround in the lawn care business if demand increases [4] - The company is recognized for its strong brands and quality products, with shares down 15% year to date, presenting a potential opportunity for long-term investors [4]

Key Takeaways Toro Company missed third-quarter earnings and revenue estimates as both homeowners and businesses pulled back on purchases. The maker of lawn mowers and snowblowers also reduced its full-year profit and sales forecasts. CEO Richard Olsen said the results were impacted by macroeconomic pressures. Toro Company (TTC) shares sank Thursday as the manufacturer of lawn mowers and snowblowers reported worse-than-expected results and guidance on falling demand for its products amid what Chief Executiv ...

Toro (TTC) came out with quarterly earnings of $1.18 per share, missing the Zacks Consensus Estimate of $1.23 per share. This compares to earnings of $0.95 per share a year ago. These figures are adjusted for nonrecurring items. This quarterly report represents an earnings surprise of -4.07%. A quarter ago, it was expected that this landscaping, maintenance and irrigation equipment maker would post earnings of $1.27 per share when it actually produced earnings of $1.40, delivering a surprise of 10.24%. Over ...