Upcoming AWS Coverage on PPG Industries Post-Earnings Results

LONDON, UK / ACCESSWIRE / December 28, 2016 / Active Wall St. announces its post-earnings coverage on The Valspar Corp. (NYSE: VAL). The Company posted its financial results for the fourth quarter fiscal 2016 (Q4 FY16) and full year fiscal 2016 (FY16) on December 20, 2016. The Minneapolis, Minnesota-based Company reported a 4% y-o-y decline in its quarterly net sales; however its net income rose 1% on a y-o-y basis during the reported quarter. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of The Valspar's competitors within the Specialty Chemicals space, PPG Industries, Inc. (NYSE: PPG), will release its fourth quarter and full-year 2016 earnings release on Thursday, Jan. 19, 2017, before US stock markets open and will conduct its Teleconference on the same day at 2 p.m. ET. AWS will be initiating a research report on PPG Industries in the coming days.

Today, AWS is promoting its earnings coverage on VAL; touching on stock like PPG. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=VAL

http://www.activewallst.com/registration-3/?symbol=PPG

Earnings Reviewed

During the quarter ended on October 28, 2016, Valspar reported net sales of $1.11 billion compared to $1.15 billion recorded at the end of Q4 FY15. The market had expected the Company to report total revenue of $1.16 billion. Additionally, Q4 FY16 net sales included foreign currency translation headwinds of 1% and a decline in total volume of 2% y-o-y.

The paint maker's net income improved marginally to $103.59 million, or $1.27 per diluted share, in Q4 FY16 compared to $102.36 million, or $1.26 per diluted share. The quarterly net income included restructuring and other asset-related charges amounting to $5 million and expenses related to the proposed merger with The Sherwin-Williams Co. of approximately $3 million. Furthermore, total one-time expenses impacted Q4 FY16 net income by $0.10 per share. Wall Street had expected the Company to report net income (excluding one-timers) of $1.37 per diluted share.

In FY16, Valspar's net sales came in at $4.19 billion compared to $4.39 billion in the previous year period. During FY16, acquisitions added 3% to net sales and 2% to volume; while sales was impacted by a 3% headwind from foreign currency translation. The Company reported net income of $353.04 million, or $4.36 per diluted share in FY16, versus $399.51 million, or $4.85 per diluted share, in FY15.

Operational Metrics

In the reported quarter, the Company's gross profit stood at $393.57 million compared to $413.61 million in Q4 FY15. During Q4 FY16, Valspar's selling, general, and administrative expenses were $224.50 million versus $211.38 million in the prior year's corresponding quarter. The Company's income from operations came in at $134.07 million in Q4 FY16 compared to $168.99 million in Q4 FY15. The Company reported EBIT of $109.30 million for Q4 FY16 versus $144.79 million in the last year's comparable quarter.

Segment-Wise

The Company's Coatings segment reported a 2% y-o-y growth in volume, with acquisition 1% of the total volume of growth. However, Coatings segment's sales fell 2% y-o-y to $626.10 million, which was negatively impacted by foreign currency translation and partially offset by acquisition's benefits. In Q4 FY16, the segment reported an EBIT of $108.94 million compared to $122.71 million in Q4 FY16. During the reported period, EBIT as a percent of net sales fell to 17.4% from 19.2% in the year-ago same period.

Valspar's Paints segment's volume decline 7% on a y-o-y basis in Q4 FY16. The segment's net sales were also down by 7% in Q4 FY16 to $420.95 million, with a 1% negative impact from foreign currency translation. Paints segment's EBIT fell 21% on a y-o-y basis to $44.05 million in Q4 FY16, primarily on lower sales and higher employee-related costs, partially offset by benefits from productivity initiatives. In Q4 FY16, EBIT as a percent of net sales stood at 10.5% compared to 12.3% in Q4 FY15.

Cash Flow & Balance Sheet

At the close of books on October 28, 2016, Valspar had $174.72 million in cash and cash equivalents compared to $185.96 million at the close of books on October 30, 2015. The Company's long-term debt reduced in the reported year, which stood at $1.56 billion as on October 28, 2016, compared to $1.71 billion as on October 30, 2015.

Stock Performance

At the closing bell, on Tuesday, December 27, 2016, Valspar's stock rose slightly by 0.02%, ending the trading session at $103.50. A total volume of 213.86 thousand shares were traded at the end of the day. In the last twelve months, shares of the company have advanced 25.30%. Moreover, the stock surged 26.52% since the start of the year. The stock is trading at a PE ratio of 23.77 and has a dividend yield of 1.43%.

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SOURCE: Active Wall Street