Notable Earnings to Watch: Raven Industries (NASDAQ:RAVN)

Raven Industries (NASDAQ:RAVN) spotted trading -30.82% off 52-week high price. On the other end, the stock has been noted 4.39% away from the low price over the last 52-weeks. The stock changed 0.17% to recent value of $34.45. The stock transacted 72351 shares during most recent day however it has an average volume of 121.84K shares. The company has 37.32M of outstanding shares and 34.45M shares were floated in the market.

Raven Industries (NASDAQ:RAVN) reported financial results for the first quarter that ended April 30, 2019.

Noteworthy Items:

Temporary conditions held down first quarter results; however, growth in sales and operating income are expected for the full year in each division and for the Company;

Consolidated net sales decreased 12 percent year-over-year in the first quarter (a decrease of 4 percent year-over-year when excluding the impact of hurricane recovery film sales);1

Engineered Films completed the commissioning of Line 15, its new blown film production line with advanced capabilities, which will provide future growth within the industrial and geomembrane end-markets;

Engineered Films was awarded and began fabrication on a new $7.4 million geomembrane installation project in Carlsbad, CA;

Engineered Films’ net sales decreased 26 percent year-over-year (a decrease of 13 percent year-over-year when excluding the impact of hurricane recovery film sales);2

Aerostar’s net sales increased 12 percent year-over-year as the division began delivering on the previously announced five-year $36 million radar systems contract award with the U.S. Naval Air Warfare Center;

Applied Technology’s integration of the AgSync (AgSync) acquisition is progressing very well and initial customer feedback regarding this transaction has been exceptionally strong;

Applied Technology increased net sales 3 percent year-over-year on strength in Brazil, despite temporary end-market weakness in North America as a result of the very wet spring.

First Quarter Results:

Net sales for the first quarter of fiscal 2020 were $98.2 million, down 11.7 percent versus the first quarter of fiscal 2019. Hurricane recovery film sales declined $8.9 million in the first quarter of fiscal 2020 compared to the first quarter of fiscal 2019. Excluding sales of hurricane recovery film, consolidated net sales in the first quarter decreased $4.0 million, or 4.0 percent year-over-year.1 Both Applied Technology and Aerostar accomplished year-over-year sales growth, but the decline in net sales from Engineered Films drove the consolidated result. Engineered Films’ net sales were adversely impacted in the first quarter by temporary operational inefficiencies associated with the go-live on a new enterprise resource planning (ERP) platform and weather-related impacts that forced production shutdowns and delayed delivery of certain raw materials. The Company estimates these factors, on a combined basis, negatively impacted Engineered Films’ net sales in the first quarter by approximately $4.5 million.

Operating income for the first quarter of fiscal 2020 was $15.1 million versus operating income of $21.5 million in the first quarter of fiscal 2019, decreasing 29.8 percent year-over-year. The year-over-year decrease was primarily due to negative operating leverage as a result of lower sales volume. Sales volume was down significantly in Engineered Films due to prior year abnormally high hurricane recovery film sales, the post go-live temporary operational inefficiencies and weather-related impacts to production. Increased investment in research and development activities in both Applied Technology and Aerostar to drive future growth also negatively impacted operating income versus the prior year.

Net income for the first quarter of fiscal 2020 was $13.2 million, or $0.36 per diluted share, versus net income of $22.1 million, or $0.61 per diluted share, in last year’s first quarter. Included in the prior year’s first quarter results on a pre-tax basis was an expense associated with a gift to South Dakota State University of $4.5 million ($3.7 million after-tax, or $0.10 per diluted share) and a non-operating gain on the sale of the Company’s ownership interest in Site-Specific Technologies (SST) of $5.8 million ($4.7 million after-tax, or $0.13 per diluted share). The net impact of these two non-recurring events to the prior year’s first quarter was a favorable $0.03 per diluted share. In addition, this year’s first quarter net income benefited from approximately $1 million ($0.03 per diluted share) in favorable discrete tax items which reduced the Company’s effective tax rate by approximately 6 percentage points year-over-year.

Its earnings per share (EPS) expected to touch remained 24.50% for this year while earning per share for the next 5-years is expected to reach at 15.00%. RAVN has a gross margin of 32.60% and an operating margin of 13.50% while its profit margin remained 12.70% for the last 12 months.

According to the most recent quarter its current ratio was 5.5 that represents company’s ability to meet its current financial obligations. The price moved ahead of -7.40% from the mean of 20 days, -9.19% from mean of 50 days SMA and performed -14.73% from mean of 200 days price. Company’s performance for the week was -0.86%, -9.49% for month and YTD performance remained -4.81%.

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