Fortune Brands Home & Security Earnings: Here’s Why Investors are Excited Now

Fortune Brands Home & Security Inc (:FBHS) delivered a profit and beat Wall Street’s expectations, AND met the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are up 1.78%.

Fortune Brands Home & Security Inc Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 41.38% to $0.41 in the quarter versus EPS of $0.29 in the year-earlier quarter.

Revenue: Rose 11.19% to $1.04 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: reported adjusted EPS income of $0.41 per share. By that measure, the company beat the mean analyst estimate of $0.39. It met the average revenue estimate of $1.04 billion.

Quoting Management: “We continue to leverage the market recovery with strong second quarter results,” said Chris Klein, chief executive officer, Fortune Brands Home & Security. “We developed solid momentum in the first half of the year by focusing on profitable growth. Based on our strong first half performance, our continued confidence in the home products market, and our efficient closing of the WoodCrafters acquisition, we are again increasing our annual outlook.”
“Sales were up double digits in each of our home segments, with these segments growing a combined 13 percent vs. last year, once again outperforming the market. Importantly, this was very profitable growth, with operating income before charges/gains increasing 54 percent for the home product segments. New housing construction continued at a strong pace, and spending on home repairs and remodeling continued to strengthen,” Klein said.

Key Stats (on next page)…

Revenue increased 16.85% from $890 million in the previous quarter. EPS increased 70.83% from $0.24 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.37 to a profit $0.38. For the current year, the average estimate has moved up from a profit of $1.23 to a profit of $1.36 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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