Quanex Building Products NX exceeded expectations in its recent quarterly earnings report, reporting $0.73 per share, surpassing the Zacks Consensus Estimate of $0.70. This marks a 4.29% earnings surprise, although it falls short of the previous year’s earnings of $0.97 per share. These figures are adjusted for non-recurring items. The company has consistently outperformed consensus EPS estimates for the past four quarters. In addition to surpassing earnings expectations, Quanex also exceeded revenue estimates for the quarter ended July 2024, reporting $280.35 million, surpassing the Zacks Consensus Estimate by 0.84%. This figure, however, is lower than the year-ago revenue of $299.64 million. The company has topped consensus revenue estimates three times over the last four quarters. While the recent earnings report provides some positive indicators, the sustainability of the stock’s immediate price movement hinges on management’s commentary during the earnings call and future earnings expectations. Quanex shares have experienced a decline of approximately 17.3% since the start of the year, contrasting with the S&P 500’s gain of 15.7%. Investors are naturally curious about the future prospects of Quanex, considering its underperformance compared to the market. To gain insight, it’s crucial to analyze the company’s earnings outlook. This includes understanding current consensus earnings expectations for upcoming quarters and how these expectations have evolved recently. Research has consistently shown a strong link between short-term stock fluctuations and trends in earnings estimate revisions. Investors can independently track these revisions or rely on established rating tools like the Zacks Rank, which has a proven history of leveraging the power of earnings estimate revisions. Prior to the recent earnings release, the estimate revisions trend for Quanex was mixed. Although the magnitude and direction of estimate revisions could shift following the latest earnings report, the current status translates to a Zacks Rank #3 (Hold) for the stock. This suggests that the shares are expected to perform in line with the market in the near future. It will be interesting to observe how estimates for future quarters and the current fiscal year evolve in the coming days. The current consensus EPS estimate is $0.79 on $289 million in revenues for the next quarter and $2.33 on $1.07 billion in revenues for the current fiscal year. Investors should recognize that the overall outlook for the industry can significantly influence the performance of the stock. The Building Products – Miscellaneous industry, where Quanex operates, currently holds a top 26% ranking among the 250+ Zacks industries. Research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor exceeding 2 to 1. RPM International RPM, another company within the broader Zacks Construction sector, is yet to report its results for the quarter ended August 2024. This specialty chemicals company is anticipated to post quarterly earnings of $1.76 per share in its upcoming report, signifying a year-over-year change of +7.3%. The consensus EPS estimate for the quarter has remained unchanged over the past 30 days. RPM International’s revenues are projected to reach $2.02 billion, representing a 0.3% increase from the corresponding period last year.
Quanex Building Products Beats Earnings Estimates, But Stock Faces Uncertain Future
