American Vanguard (AVD) Earnings & Sales Top Estimates in Q3
American Vanguard Corporation AVD posted profit of $3.2 million or 11 cents per share for the third quarter of 2019, down around 51% from $6.5 million or 22 cents it earned a year ago. However, earnings per share for the quarter topped the Zacks Consensus Estimate of 9 cents.
The bottom line in the reported quarter was hurt by increased operating expenses and reduced factory activity. The results in the year-ago quarter were also favorably impacted by higher benefit associated with the reassessment of deferred purchase price consideration.
Revenues went up around 12% year over year to $124.9 million in the reported quarter. It surpassed the Zacks Consensus Estimate of $123 million. Sales were driven by the company’s international business.
Total U.S. sales went up 3% year over year in the reported quarter. Sales from the U.S. crop business edged up 1% year over year while sales from U.S. non-crop business rose 10%. Extreme weather conditions impacted American Vanguard’s domestic business in the quarter.
The company's international business saw a 27% increase in sales in the third quarter. The company witnessed growth across Central America, Brazil, Mexico and Canada.
American Vanguard Corporation Price, Consensus and EPS Surprise
American Vanguard Corporation price-consensus-eps-surprise-chart | American Vanguard Corporation Quote
Segment Highlights
Revenues from American Vanguard’s insecticides business for the quarter rose around 15% year over year to $35.8 million.
Sales from the herbicides/soil fumigants/fungicides business went up 12% to $46.8 million.
Revenues from the other business, including plant growth regulators, rose 2% to $22.9 million.
Financials
American Vanguard ended the quarter with cash and cash equivalents of roughly $5.9 million, down around 37% year over year. Long-term debt was $165 million, up around 70% year over year.
Outlook
American Vanguard envisions its consolidated sales for 2019 to increase 5% year over year with mixed results in its key markets. It also expects international sales to rise roughly 25%.
The company sees net sales for 2019 of $475 million. It also expects its gross profit margins to be 38% for 2019.
Price Performance
American Vanguard’s shares are up 4.5% so far this year, compared with the 19.2% rise of the industry it belongs to.
Zacks Rank & Key Picks
American Vanguard currently carries a Zacks Rank #4 (Sell).
Better-ranked stocks worth a look in the basic materials space include Agnico Eagle Mines Limited AEM, Kirkland Lake Gold Ltd. KL and Franco-Nevada Corporation FNV, all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Agnico Eagle has a projected earnings growth rate of 168.6% for the current year. The company’s shares have rallied 70% in a year’s time.
Kirkland Lake Gold has projected earnings growth rate of 96.3% for the current year. The company’s shares have surged around 140% in a year’s time.
Franco-Nevada has estimated earnings growth rate of 39.3% for the current year. The company’s shares have shot up roughly 51% in a year’s time.
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