Praxair Inc. Earnings: Third Consecutive Quarter of Profit Growth

S&P 500 (NYSE:SPY) component Praxair Inc. (NYSE:PX) reported its results for the first 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 First Quarter

Results: Net income for the chemicals-diversified rose to $419 million ($1.38 per share) vs. $398 million ($1.29 per share) in the same quarter a year earlier. This marks a rise of 5.3% from the year-earlier quarter.

Revenue: Rose 5.1% to $2.84 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Praxair Inc. beat the mean analyst estimate of $1.36 per share. Analysts were expecting revenue of $2.83 billion.

Quoting Management: Commenting on the financial results and business outlook, Chairman and Chief Executive Officer Steve Angel said, “Our first-quarter results demonstrated continued strong growth in North America, where we are well-positioned to continue to grow from greater sales to customers in the chemical, energy and manufacturing industries who are benefiting from low natural gas costs. We expect the South America and Asia businesses to continue to grow as we start up new projects driven by increasing consumer demand and infrastructure investment.”

Key Stats:

The company has now seen its net income increase for three consecutive quarters. In the fourth quarter of the last fiscal year, net income rose more than threefold and in the third quarter of the last fiscal year, the figure rose 13.8%.

Revenue has risen for the last four quarters. Revenue increased 6.6% to $2.8 billion in the fourth quarter of the last fiscal year. The figure rose 14.1% in the third quarter of the last fiscal year from the year earlier and climbed 13.1% in the second quarter of the last fiscal year from the year-ago quarter.

The company topped expectations last quarter after falling short of forecasts in the fourth quarter of the last fiscal year with net income of $1.36 versus a mean estimate of net income of $1.37 per share.

The company’s cost of sales rose 5.2% from a year earlier. Last quarter, cost of sales was 56.9% of revenue, similar to the prior-year quarter.

Looking Forward: Over the past ninety days, the average estimate for the second quarter has fallen from $1.52 per share to $1.45, indicating that analysts are growing pessisimistic about the company’s performance next quarter. The average estimate for the fiscal year is $5.83 per share, down from $5.98 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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