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Stanley Black & Decker's Third Quarter Earnings Report
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Stanley Black & Decker (NYSE:SWK) announced its results for the most recent quarter on October 17, 2012. Stanley Black & Decker supplies tools and engineered solutions for professional, industrial, construction, and do-it-yourself use, as well as security solutions for industrial and commercial applications.
Investors care about earnings because they drive stock prices. Strong earnings generally result in the stock price moving up and vice versa. SEE: Surprising Earnings Results
The Numbers: Stanley Black & Decker missed estimates with 69 cents per share and revenues of $2.8 billion. Analysts were expecting $1.52 per share and revenues of $2.9 billion. EPS fell 25% while revenue climbed 6.2% from the same period last year. Stanley Black & Decker's revenue has grown during each of the past four quarters on a year-over-year basis. The company's net income for the quarter fell 25.6% to $115 million. Last quarter marks the third in a row in which the company's net income has fallen. Profits declined 21.5% in the second quarter and 23.3% in the first quarter.
Management Quote: Stanley Black & Decker's President and CEO, John F. Lundgren, commented, "During the quarter, we saw pockets of strength within our Hand and Power Tool businesses in the U.S. and the emerging markets, largely driven by our successful new product innovations, which are enabling us to continue to gain market share. Our Engineered Fastening business was a bright spot in our Industrial segment, as increased vehicle platform penetration drove growth in the U.S. and in Asia, which more than offset the pullback we saw in the European industrial markets. Conversely, our Industrial & Automotive Repair business in Europe, which is one of the most profitable in the Industrial segment, continued to experience market-related contraction."
A Look Back: Net income has dropped 5.2% year-over-year on average across the last five quarters. Performance was hurt by a 25.6% decline in the most recent quarter from the year-earlier quarter.
Looking Ahead: For the next quarter, analysts are growing pessimistic about the company's expected results. The average estimate for the fourth quarter is $1.60 per share, dropping from $1.62 a month ago. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. For the fiscal year, the average estimate has moved down from $5.87 a share to $5.77 over the last 90 days.
Investors care about earnings because they drive stock prices. Strong earnings generally result in the stock price moving up and vice versa. SEE: Surprising Earnings Results
The Numbers: Stanley Black & Decker missed estimates with 69 cents per share and revenues of $2.8 billion. Analysts were expecting $1.52 per share and revenues of $2.9 billion. EPS fell 25% while revenue climbed 6.2% from the same period last year. Stanley Black & Decker's revenue has grown during each of the past four quarters on a year-over-year basis. The company's net income for the quarter fell 25.6% to $115 million. Last quarter marks the third in a row in which the company's net income has fallen. Profits declined 21.5% in the second quarter and 23.3% in the first quarter.
Management Quote: Stanley Black & Decker's President and CEO, John F. Lundgren, commented, "During the quarter, we saw pockets of strength within our Hand and Power Tool businesses in the U.S. and the emerging markets, largely driven by our successful new product innovations, which are enabling us to continue to gain market share. Our Engineered Fastening business was a bright spot in our Industrial segment, as increased vehicle platform penetration drove growth in the U.S. and in Asia, which more than offset the pullback we saw in the European industrial markets. Conversely, our Industrial & Automotive Repair business in Europe, which is one of the most profitable in the Industrial segment, continued to experience market-related contraction."
A Look Back: Net income has dropped 5.2% year-over-year on average across the last five quarters. Performance was hurt by a 25.6% decline in the most recent quarter from the year-earlier quarter.
Looking Ahead: For the next quarter, analysts are growing pessimistic about the company's expected results. The average estimate for the fourth quarter is $1.60 per share, dropping from $1.62 a month ago. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. For the fiscal year, the average estimate has moved down from $5.87 a share to $5.77 over the last 90 days.
by
Investopedia Staff
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