Beacon Roofing Supply Earnings: Here’s Why the Stock is Up Now

Beacon Roofing Supply Inc. (NASDAQ:BECN) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 0.55%.

Beacon Roofing Supply Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 0% to $0.62 in the quarter versus EPS of $0.62 in the year-earlier quarter.

Revenue: Rose 11.89% to $627.2 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Beacon Roofing Supply Inc. reported adjusted EPS income of $0.62 per share. By that measure, the company missed the mean analyst estimate of $0.71. It missed the average revenue estimate of $668.77 million.

Quoting Management: Paul Isabella, the Company’s President & Chief Executive Officer, stated: “We experienced a challenging demand environment during the third quarter of fiscal 2013, however we still recorded double-digit growth with sales up 12% over last year. Our total sales benefited from the positive impact of several acquisitions made since the start of last year, as well as a 1.2% increase in organic sales in the quarter. In addition to 19 branches acquired so far this year, we also opened two branches in this year’s third quarter and three new branches year to date. Our sales growth occurred despite unusually heavy rains and other harsh weather factors in many of our markets that delayed Spring and early Summer roofing activities, as well as the negative impact from fewer hail storms during fiscal 2013 than in the prior year. The soft demand led to pricing pressures that negatively impacted our gross margins, although our continued focus on expense controls enabled us to limit the impact on earnings. Our fourth quarter sales volumes are off to a good start and we will continue to focus on opening new branches, smart acquisition growth and improving our gross margins.”

Key Stats (on next page)…

Revenue increased 50.67% from $416.28 million in the previous quarter. EPS increased to $0.62 in the quarter versus EPS of $-0.02 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.74 to a profit $0.73. For the current year, the average estimate has moved down from a profit of $1.84 to a profit of $1.8 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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