Research Desk Line-up: EnerSys Post Earnings Coverage

LONDON, UK / ACCESSWIRE / November 15, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on A.O. Smith Corp. (NYSE: AOS), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=AOS, following the Company's posting of its financial results on October 25, 2017, for the third quarter of the fiscal year 2017. The manufacturer of commercial and residential water heating equipment's net revenue and EPS surpassed analysts' expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Get more of our free earnings reports coverage from other constituents of the Industrial Electrical Equipment industry. Pro-TD has currently selected EnerSys (NYSE: ENS) for due-diligence and potential coverage as the Company announced on November 08, 2017, its financial results for Q2 FY18 which ended on October 01, 2017. Register for a free membership today, and be among the early birds that get access to our report on EnerSys when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on AOS; also brushing on ENS. With the links below you can directly download the report of your stock of interest free of charge at:

http://protraderdaily.com/optin/?symbol=AOS

http://protraderdaily.com/optin/?symbol=ENS

Earnings Reviewed

For the three months ended September 30, 2017, A. O. Smith's net revenues increased 9.6% to $749.9 million from $683.9 million in Q3 FY16. The increase was due to a strong demand for the Company's Lochinvar branded boilers, a mid-single digit growth in residential water heater volumes in the US, as well as the sale of water treatment and air purification in China. The net revenue surpassed analysts' expectations of $742 million.

During Q3 FY17, the Company's gross profit increased 8.3% to $306.7 million from $283.3 million in the same period of last year. For the reported quarter, the Company's gross margin decreased 50 basis points to 40.9% of revenue from 41.4% of revenue in Q3 FY16.

For the reported quarter, A. O. Smith's selling, general, and administrative expenses (SG&A) increased 6.7% to $175.8 million from $164.7 million in Q3 FY16.

During Q3 FY17, the Company's earnings before tax (EBT) increased 11.1% to $131.6 million from $118.4 million in the comparable period of last year. For the reported quarter, the Company's EBT margin increased 20 basis points to 17.5% of revenue from 17.3% of revenue in the third quarter of last year.

For the reported quarter, A. O. Smith's net income increased 12.6% to $93.7 million on a y-o-y basis from $83.2 million in Q3 FY16. During Q3 FY17, the Company's diluted earnings per share (EPS) increased 14.9% to $0.54 on a y-o-y basis from $0.47 in the corresponding period of last year. The diluted EPS surpassed analysts' expectations of $0.53.

During September 2017, A. O. Smith acquired Hague, the US water softener Company.

Segment Details

North America - During Q3 FY17, A. O. Smith's North America segment's net revenue increased 7.8% to $486.0 million from $450.8 million in the same period of last year, due to increased sales of boilers, higher volumes of residential water heaters, and pricing actions related to higher steel costs. For the reported quarter, the segment's net income increased 9.7% to $110.3 million from $100.5 million in the third quarter of 2016.

Rest of World - During Q3 FY17, A. O. Smith's Rest of World segment's net revenue increased 12.4% to $270.1 million from $240.3 million in the comparable period of last year. The increase was primarily due to a 13% increase in China's revenue resulting from higher demand for the Company's premium consumer products and pricing actions. For the reported quarter, the segment's net income increased 8.6% to $33.8 million from $31.1 million in the third quarter of 2016.

Balance Sheet

As on September 30, 2017, A. O. Smith's cash and cash equivalents decreased 2.6% to $321.9 million from $330.4 million as on December 31, 2016. For the reported quarter, the Company's long-term debt increased 39.8% to $442.2 million from $316.4 million in Q4 FY16.

For the reported quarter, the Company's receivables increased 13.1% to $587.1 million from $518.7 million on December 31, 2016. During Q3 FY17, A. O. Smith's trade payables decreased 5.4% to $500.1 million from $528.6 million in Q4 FY16.

During FY17, the Company's YTD cash provided by operating activities decreased 43% to $150.2 million from $263.6 million in the corresponding period of last year.

Outlook

For FY17, A. O. Smith expects net revenue growth to be in the range of 11% - 12%, and estimates diluted EPS to be in the band of $2.12 - $2.14.

Stock Performance

On Tuesday, November 14, 2017, the stock closed the trading session at $58.82, slightly falling 0.17% from its previous closing price of $58.92. A total volume of 768.60 thousand shares have exchanged hands. A.O. Smith's stock price surged 7.30% in the last three months, 10.09% in the past six months, and 23.68% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have rallied 24.22%. The stock is trading at a PE ratio of 28.89 and has a dividend yield of 0.95%. At Tuesday's closing price, the stock's net capitalization stands at $10.13 billion.

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