Powell Industries Earnings Preview

Before you go, we thought you'd like these...
Before you go close icon

Powell Industries (NAS: POWL) beat estimates by $0.01 last quarter and investors are hoping it can beat them again. The company will unveil its latest earnings on Tuesday, Feb. 7. Powell Industries develops, designs, manufactures, and services custom engineered-to-order equipment and systems for the management and control of electrical energy and other critical processes.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Powell Industries with three of four analysts rating it hold. Analysts like Powell Industries better than competitor American Superconductor overall. Zero out of seven analysts rate American Superconductor a buy compared to one of four for Powell Industries.
  • Revenue forecasts: On average, analysts predict $161.1 million in revenue this quarter. That would represent a rise of 29.2% from the year-ago quarter.
  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.20 per share. Estimates range from $0.15 to $0.23.

What our community says:
CAPS All-Stars are solidly supporting the stock, with 89.7% awarding it an "outperform" rating. The greater community agrees with the All-Stars, as 89.4% give it a rating of "outperform." Fools are impressed with Powell Industries, though the message boards have been quiet lately with only 63 posts in the past 30 days. Despite the majority sentiment in favor of Powell Industries, the stock has a middling CAPS rating of three out of five stars.

Management:
The company's revenue has now risen for two straight quarters. The company's gross margin shrank by 7.4 percentage points in the last quarter. Revenue rose 27.1% while cost of sales rose 39.1% to $145.1 million from a year earlier.

Now let's get some insight into how efficient management is at running the business. Traditionally, margins serve as an illustration of how efficiently a company captures portions of sales dollars. Powell Industries has seen declining gross margins year-over-year for the last four quarters. Gross margins reflect the total sales revenue retained after costs. See how Powell Industries has been doing for the last four quarters:

Quarter

Q4

Q3

Q2

Q1

Gross Margin

14.7%

16.5%

20.4%

20.7%

Operating Margin

(3.8%)

2.0%

2.3%

3.0%

Net Margin

(5.5%)

1.2%

2.0%

2.0%

For all our Powell Industries-specific analysis, including earnings and beyond, add Powell Industries to My Watchlist.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Earnings estimates provided by Zacks.

At the time this article was published

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners