It’s tough to get maximum value from owning a good house in a bad neighborhood, but it’s even tougher when the neighborhood changes seemingly every year. That’s one way to think about Insteel Industries (Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeki ...

Core Viewpoint - Insteel Industries, Inc. (IIIN) and Atkore Inc. (ATKR) are positioned to benefit from growth in the construction sector, driven by repair and remodeling activities, with each company having distinct strengths and challenges in their respective markets [1]. Insteel Industries - IIIN is a leader in manufacturing steel wire reinforcing products for concrete construction, experiencing strong demand due to increased construction activity and contributions from acquired assets [2][3]. - In the second quarter of fiscal 2025, IIIN's net sales rose 26.1% year-over-year to $160.7 million, with shipments increasing by 28.9% [3]. - The company anticipates growth in the non-residential construction market, supported by federal funding from the Infrastructure Investment and Jobs Act, which is expected to enhance project activity [4]. - IIIN is focused on acquisitions to expand its customer base and product lines, including the acquisition of EWP and O'Brien Wire Products, which strengthened its position in the Midwest and enhanced its product offerings [5]. - In the first half of fiscal 2025, IIIN returned $20.6 million to shareholders in dividends and repurchased $1.7 million in shares [6]. Atkore Inc. - ATKR specializes in diversified electrical infrastructure products and is benefiting from strong demand in the data center market for its metal framing and cable management solutions [7]. - The company has invested in enhancing its construction services, leading to a 3.4% year-over-year increase in organic revenues in the Safety & Infrastructure segment in the second quarter of fiscal 2025 [8]. - In the first half of fiscal 2025, ATKR paid $22 million in dividends and repurchased $100 million in shares, with a 3.1% dividend increase announced in April 2025 [9]. - However, ATKR faces challenges with rising operating costs, as its cost of sales increased by 3% year-over-year, leading to a decline in gross margin by 1,040 basis points to 26.4% [10]. Earnings Estimates - The Zacks Consensus Estimate for IIIN's fiscal 2025 earnings is $1.86 per share, reflecting a 34.8% increase over the past 30 days and an 87.9% year-over-year growth [11]. - For ATKR, the fiscal 2025 earnings estimate stands at $6.00 per share, indicating a 3.6% increase over the past 30 days but a year-over-year decline of 52.7% [11]. Stock Performance and Valuation - Over the past three months, IIIN shares have increased by 27.5%, while ATKR stock has gained 4.3% [13]. - IIIN is trading at a forward price-to-earnings ratio of 14.46X, below its two-year median of 15.43X, whereas ATKR's forward earnings multiple is 11.53X, above its median of 9.73X [14]. Final Assessment - IIIN's strong momentum in the non-residential construction market, along with strategic acquisitions and growth investments, positions it favorably for future growth [15]. - In contrast, ATKR's profitability is being impacted by rising costs, despite its strengths in the Safety & Infrastructure segment [15]. - Based on current factors, IIIN is viewed as a more attractive investment compared to ATKR, with IIIN holding a Zacks Rank of 1 (Strong Buy) and ATKR a Zacks Rank of 3 (Hold) [16].

Core Viewpoint - MRC Global Inc. reported first-quarter 2025 adjusted earnings of 14 cents per share, exceeding the Zacks Consensus Estimate of 8 cents, but down from 21 cents per share in the same quarter last year. Total revenues of $712 million also surpassed the consensus estimate of $710 million, although they decreased by 8.4% year over year due to lower sales volumes in specific sectors [1]. Revenue Summary by Product Line - Revenues from carbon pipe, fittings, and flanges decreased by 22.5% year over year to $162 million. - Revenues from valves, automation, measurement, and instrumentation fell by 0.7% year over year to $277 million. - Gas product revenues remained stable year over year at $187 million. - Sales of general products dropped by 28.1% to $46 million, while sales of stainless steel and alloy pipe and fittings increased by 5.3% to $40 million [2]. Revenue Summary by Sector - Revenues from Gas Utilities increased by 3% year over year to $273 million. - Sales in the Downstream, Industrial and Energy Transition (DIET) sector decreased by 17.7% to $220 million. - Sales from the Production & Transmission Infrastructure (PTI) sector fell by 10.6% year over year to $219 million [3]. Revenue Summary by Segment - Sales from the U.S. segment, which represents 83% of total revenues, totaled $591 million, down 11.4% year over year due to reduced demand in DIET and PTI sectors. - Sales from the International segment, accounting for 17% of revenues, grew by 10% year over year to $121 million, driven by higher revenues from the PTI sector [4]. Margin Profile - MRC Global's cost of sales declined by 7.8% year over year to $570 million. - Adjusted gross profit decreased by 10% year over year to $153 million, with an adjusted gross margin of 21.5%, compared to 21.9% in the previous year. - Selling, general, and administrative expenses rose by 3.3% year over year to $124 million, while adjusted EBITDA decreased by 36.8% year over year to $36 million [5]. Balance Sheet and Cash Flow - At the end of the first quarter of 2025, MRC had a cash balance of $63 million, stable compared to December 2024. - Long-term debt, including the current portion, was $367 million, with net debt at $308 million [6]. - The company generated net cash of $14 million from operating activities, down from $38 million in the year-ago period. - Capital expenditures for property, plant, and equipment were $9 million, up 50% year over year, and no dividends were paid on preferred stock compared to $6 million in the previous year [7]. 2025 Outlook - MRC Global anticipates that its second-quarter 2025 revenues will increase in the high-single to low-double-digit range sequentially, driven by growth across its three business sectors [9].

Core Insights - Johnson Controls International plc (JCI) reported adjusted earnings of 82 cents per share for Q2 fiscal 2025, exceeding the Zacks Consensus Estimate of 79 cents, marking a 19% year-over-year increase [1] - Total revenues for continuing operations reached $5.68 billion, surpassing the consensus estimate of $5.64 billion, with a year-over-year increase of 1.4% and organic revenue growth of 7% [1] Segment Performance - **Building Solutions North America**: Revenues were $2.92 billion, up 6% year over year, with organic sales increasing 7%, driven by strong HVAC and controls performance. Adjusted EBITA rose 5% to $390 million [2] - **Building Solutions Europe, Middle East, Africa/Latin America**: Revenues totaled $1.09 billion, a 2% year-over-year increase, with organic sales climbing 5%. Adjusted EBITA surged 53% to $136 million [3] - **Building Solutions Asia Pacific**: Revenues increased 10% to $542 million, with organic sales growing 13%. Adjusted EBITA was $79 million, up 46% year over year [4] - **Global Products**: Revenues were $1.13 billion, down 13% year over year, but organic sales increased 8%. Adjusted EBITA rose 9% to $343 million [5] Financial Metrics - JCI's cost of sales decreased 1.9% year over year to approximately $3.6 billion, while gross profit increased 7.5% to $2.1 billion, resulting in a margin increase of 220 basis points to 36.5%. Selling, general and administrative expenses were $1.4 billion, down 30.9% year over year [6] - As of March 31, 2025, JCI had cash and cash equivalents of $795 million, up from $606 million at the end of fiscal 2024. Long-term debt increased to $8.2 billion from $8 billion [7] - In the first half of fiscal 2025, the company generated net cash of $799 million from operating activities, compared to a cash outflow of $437 million in the prior year. Free cash flow was $589 million, a significant improvement from a cash outflow of $647 million in the previous year [8] Future Guidance - For Q3, JCI anticipates mid-single-digit organic revenue growth and an adjusted segment EBITA margin of approximately 17.5%. Adjusted earnings are expected to be in the range of $0.97-$1.00 per share [9] - For the full fiscal year 2025, JCI expects organic revenue growth in the mid-single-digit range, an adjusted segment EBITA margin improvement of 90 basis points, and adjusted earnings of about $3.60 per share, with free cash flow conversion expected to be approximately 100% [11]

Core Insights - Cimpress plc (CMPR) reported an adjusted loss of 33 cents per share for Q3 fiscal 2025, missing the Zacks Consensus Estimate of earnings of 55 cents, and compared to an adjusted loss of 15 cents per share in the same quarter last year [1] - Total revenues for the quarter were $789.5 million, a 1% increase from $780.6 million year-over-year, but below the Zacks Consensus Estimate of $798 million [1] Revenue Breakdown - The National Pen segment generated revenues of $88.3 million, slightly down from $88.6 million in the year-ago quarter, and below the estimate of $91 million [2] - The Vista segment, the largest revenue generator, reported revenues of $430.7 million, up from $418.1 million year-over-year, but slightly below the estimate of $432 million [2] - The Upload and Print segment's revenues increased to $245.3 million from $237.8 million in the year-ago quarter, exceeding the estimate of $245 million [3] - Revenues from All Other Businesses were $51.1 million, compared to $48.8 million reported a year ago, and above the estimate of $49.8 million [4] Margin and Cost Analysis - Cimpress' cost of revenues was $417 million, reflecting a 3% year-over-year increase [5] - Gross profit decreased by 0.8% year-over-year to $373 million, with a margin of 47%, down 100 basis points from the previous year [6] - Adjusted EBITDA fell 3.7% year-over-year to $90.7 million [6] Balance Sheet and Cash Flow - As of March 31, 2024, Cimpress had $183 million in cash and cash equivalents, down from $203.8 million at the end of Q4 fiscal 2024 [7] - Long-term debt was $1.58 billion, slightly down from the previous quarter [7] - Net cash provided by operating activities was $9.7 million, an increase from $8.4 million in the year-ago quarter, with share repurchases totaling $3.9 million during the quarter [8] Outlook - The company has withdrawn its previously issued guidance for fiscal 2025 due to uncertainties in the tariff environment and its potential impact on costs and market demand [9]

Core Insights - Illinois Tool Works Inc. (ITW) reported first-quarter 2025 adjusted earnings of $2.38 per share, exceeding the Zacks Consensus Estimate of $2.34, but reflecting a 2.5% year-over-year decline [1] - Revenues for the quarter were $3,839 million, slightly below the consensus estimate of $3,842 million, marking a 3.4% year-over-year decrease, primarily due to unfavorable foreign currency translation and a 1.6% decline in organic sales [1] Segment Performance - Test & Measurement and Electronics revenues decreased 6.3% year over year to $652 million, missing the estimate of $687.8 million [2] - Automotive Original Equipment Manufacturer revenues fell 3.7% year over year to $786 million, slightly above the estimate of $772.8 million [2] - Food Equipment revenues were $627 million, down 0.7% year over year, close to the estimate of $629.3 million [3] - Welding revenues decreased 0.9% year over year to $472 million, surpassing the estimate of $465.1 million [3] - Construction Products revenues declined 9.2% year over year to $443 million, below the estimate of $453.8 million [4] - Specialty Products revenues were $435 million, reflecting a 1% year-over-year decrease, also below the estimate of $445.6 million [4] - Polymers & Fluids revenues of $429 million declined 0.8% year over year, slightly above the estimate of $422 million [4] Margin Profile - Cost of sales increased 0.7% year over year to $2.16 billion, while selling, administrative, and research and development expenses rose 4.4% year over year to $706 million [5] - The operating margin was 24.8%, down 60 basis points from the previous year, with enterprise initiatives contributing 120 basis points to the margin [5] Balance Sheet and Cash Flow - At the end of Q1 2025, cash and equivalents stood at $873 million, down from $948 million at the end of December 2024 [6] - Long-term debt increased to $7.28 billion from $6.31 billion at the end of December 2024 [6] - Net cash generated from operating activities was $592 million, reflecting a 0.5% increase year over year [7] - Capital spending on plant and equipment was $96 million, up 1% year over year, with free cash flow at $496 million, a 0.4% year-over-year increase [7] 2025 Guidance - ITW reaffirmed its full-year 2025 financial guidance, expecting earnings in the range of $10.15-$10.55 per share [8] - Revenues and organic revenues are projected to increase by 0-2%, with an expected operating margin of 26.5–27.5% [8] - Enterprise initiatives are anticipated to contribute approximately 100 basis points to the operating margin [8] - The company projects free cash flow to exceed 100% of net income and plans to repurchase about $1.5 billion worth of shares [9] - The effective tax rate is expected to be around 24% [9]