Invacare Earnings: Here’s Why the Stock is Up Now

Invacare Corporation (NYSE:IVC) had a loss 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 1.62%.

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Invacare Corporation Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased to $-0.36 in the quarter versus EPS of $0.25 in the year-earlier quarter.

Revenue: Decreased 22.13% to $337.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Invacare Corporation reported adjusted EPS loss of $0.36 per share. By that measure, the company missed the mean analyst estimate of $-0.09. It missed the average revenue estimate of $433.6 million.

Quoting Management: Gerald B. Blouch, President and Chief Executive Officer, stated, “Our first quarter financial results were dramatically impacted by the Company’s consent decree with the United States Food and Drug Administration (FDA), which limits the Company’s ability to manufacture products at its Taylor Street facility in Elyria, Ohio. Principally as a result of this pressure on the Company’s higher margin custom power wheelchair product category, adjusted earnings per share(NYSE:A) decreased to a loss of $0.36 in the first quarter of 2013 compared to adjusted earnings per share(NYSE:A) of $0.15 in the first quarter of 2012. Organic net sales declined by 5.6% compared to the same period last year with a strong performance from Europe being more than offset by lower net sales for all other segments. The Company’s free cash flow(NYSE:C) in the first quarter was negative $36.1 million, principally due to the net loss from continuing operations, but also due to a few one-time items associated with the sale of ISG (negative cash flow impact of approximately $16.0 million). In addition, free cash flow(NYSE:C) was negatively impacted by increased inventory related to weaker than expected sales (negative cash flow impact of $7.7 million).”

Key Stats (on next page)…

Revenue increased 196.17% from $113.99 million in the previous quarter. EPS decreased to $-0.36 in the quarter versus EPS of $0.11 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 $0.23 to a loss $0.03. For the current year, the average estimate has moved down from a profit of $1.15 to a profit of $0.28 over the last ninety days.

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