Olympic Steel Inc. (NASDAQ:ZEUS) 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.
Olympic Steel Inc. Earnings Cheat Sheet
Results: Adjusted Earnings Per Share decreased 43.9% to $0.23 in the quarter versus EPS of $0.41 in the year-earlier quarter.
Revenue: Decreased 9.95% to $330.8 million from the year-earlier quarter.
Actual vs. Wall St. Expectations: Olympic Steel Inc. reported adjusted EPS income of $0.23 per share. By that measure, the company missed the mean analyst estimate of $0.36. It missed the average revenue estimate of $343.82 million.
Quoting Management: Chairman and Chief Executive Officer Michael D. Siegal commented, “The first half of 2013 was characterized by lower sales volume and average selling prices compared with last year. However, despite the external headwinds, Olympic Steel successfully improved consolidated gross margin, lowered inventory levels and generated strong free cash flow. A portion of the excess cash has been used to reduce debt by more than $34 million since the beginning of this year.”
Key Stats (on next page)…
Revenue decreased 2.15% from $338.06 million in the previous quarter. EPS decreased 51.06% from $0.47 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 $0.43 to a profit $0.38. For the current year, the average estimate has moved up from a profit of $1.43 to a profit of $1.52 over the last ninety days.
Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.
(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)