Houston Wire & Cable Earnings: Here’s Why Investors are Not Happy Now

Houston Wire & Cable Company (NASDAQ:HWCC) 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 down 1.16%.

Houston Wire & Cable Company Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 8% to $0.23 in the quarter versus EPS of $0.25 in the year-earlier quarter.

Revenue: Rose 1.27% to $99.33 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Houston Wire & Cable Company reported adjusted EPS income of $0.23 per share. By that measure, the company missed the mean analyst estimate of $0.27. It missed the average revenue estimate of $99.86 million.

Quoting Management: Jim Pokluda, President and Chief Executive Officer, commented, “Continued inconsistencies in regional market conditions limited our sales increase to 1.3% over the prior year period and 5.3% sequentially. However, we estimate a more encouraging increase in sales of approximately 4% over the prior year period and 7.5% sequentially when adjusted for deflation in metal prices. We estimate Maintenance, Repair and Operations (NYSE:MRO) sales increased approximately 5% over the second quarter of 2012, while project business from our long term growth initiatives encompassing Environmental Compliance, Engineering & Construction, Industrials, LifeGuard™ (and other private branded products), Utility Power Generation, and Mechanical continued to suffer from a shortage of new large capital projects and was down approximately 5% from the prior year period.”

Key Stats (on next page)…

Revenue increased 5.33% from $94.3 million in the previous quarter. EPS increased 4.55% from $0.22 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 $0.28 to a profit $0.27. For the current year, the average estimate has moved down from a profit of $1.05 to a profit of $1.02 over the last ninety days.

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