Praxair Inc. Earnings Cheat Sheet: Third Straight Quarter of Rising Profit

S&P 500 (NYSE:SPY) component Praxair Inc. (NYSE:PX) reported its results for the third quarter. Praxair produces and sells atmospheric, process and specialty gases, and high-performance surface coatings to industrial clients.

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Praxair Earnings Cheat Sheet for the Third Quarter

Results: Net income for Praxair Inc. rose to $429 million ($1.40 per share) vs. $377 million ($1.21 per share) in the same quarter a year earlier. This marks a rise of 13.8% from the year earlier quarter.

Revenue: Rose 14.1% to $2.9 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: PX was about in line with expectations as the mean analyst estimate of $1.39 per share. It beat the average revenue estimate of $2.83 billion.

Quoting Management: Chairman and Chief Executive Officer Steve Angel said, “We are continuing to see solid growth in all geographies with the exception of Europe. Proposal activity remains at healthy levels and our backlog of large customer projects under construction is at a record $2.7 billion, 25% above 2010 levels. Most importantly, we remain confident in our ability to bring growth to the bottom line through our commitment to productivity and flawless execution.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 14.6% and in the first quarter, the figure rose 26.8%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by one cent in the second quarter, by 2 cents in the first quarter, and by 2 cents in the fourth quarter of the last fiscal year.

Gross margin shrank 1.3 percentage points to 41.9%. The contraction appeared to be driven by increased costs, which rose 16.6% from the year earlier quarter while revenue rose 14.1%.

Revenue has risen the past four quarters. Revenue increased 13.1% to $2.86 billion in the second quarter. The figure rose 11.3% in the first quarter from the year earlier and climbed 9% in the fourth quarter of the last fiscal year from the year-ago quarter.

Looking Forward: Over the past sixty days, the outlook for the company’s performance next quarter has become increasingly unfavorable. The average estimate for the fourth quarter is $1.40 per share, a drop from $1.43. The average estimate for the fiscal year is $5.46 per share, falling from $5.48 thirty days ago.

Competitors to Watch: Air Products & Chemicals, Inc. (NYSE:APD), Airgas, Inc. (NYSE:ARG), and Rentech, Inc. (AMEX:RTK).

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(Source: Xignite Financials)

 

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