American Woodmark Whiffs on Earnings
Winchester, Va.-based American Woodmark shares splintered in Tuesday trading, falling more than 6% in response to a fiscal Q2 2014 earnings report that showed the company pulling down better-than-expected revenues, but falling far short on earnings.
Sales in the second fiscal quarter rose 19% to $190.5 million, ahead of estimates, an accomplishment that management attributed primarily to the strength of its new construction sales, which grew 40%. Gross profit margins earned on these revenues also improved 140 basis points year over year, to 16.9%. This was, however, a 200-basis-point decline from Q1's gross profit margin.
Result: Profits per diluted share of $0.34 fell a nickel short of analysts' expected $0.39.
On the bright side, American Woodmark's free cash flow at the half-year mark stands at an even $10 million. Coincidentally, the company noted that it is instituting a share buyback program for just this amount, authorizing the repurchase of $10 million worth of its own common stock. At current share prices, that would amount to about 1.9% of shares outstanding.
The article American Woodmark Whiffs on Earnings originally appeared on Fool.com.Fool contributor Rich Smith and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.