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American Outdoor Brands (AOBC) Q4 Earnings Beat, Decline Y/Y

American Outdoor Brands Corporation AOBC reported financial results for fourth-quarter fiscal 2017 ended Apr 30, 2017. The company’s adjusted earnings per share of 57 cents surpassed the Zacks Consensus Estimate of 38 cents by 50%. Reported earnings, however, declined 13.6% from the year-ago level of 66 cents.

In fiscal 2017 adjusted earnings per share of $2.58 grew 41% from the year-ago figure of $1.83.

Revenues

In the fiscal fourth quarter, American Outdoor Brands’ total sales were $229.2 million, beating the Zacks Consensus Estimate of $210 million by 9.4%. Revenues were also up 3.6% from $221.1 million in the year-ago quarter.

Fiscal 2017 revenues were $903.2 million, up 24.9% from $722.9 million in fiscal 2016.

Operational Highlights

Total operating income during the quarter was $45.1 million, down 20.8% from $56.9 million in the year-ago quarter.

Gross margin for the quarter was 39.6% compared with 41.6% in fourth-quarter fiscal 2016.

American Outdoor Brands’ total operating expenses were $45.7 million, up 30% from $35.2 million in the year-ago quarter. The upside was driven by a 28.4% increase in general and administrative expenses, 39.7% increase in selling and marketing expenses, and 9.6% increase in research and development expenses.

Financial Condition

As of Apr 30, 2017, American Outdoor Brands’ cash and cash equivalents were $61.5 million compared with $191.3 million as of Apr 30, 2016.

Notes payable (net) was $210.7 million as of Apr 30, 2017, up from $166.6 million as of Apr 30, 2016.

Cash from operating activities in fiscal 2017 was $123.6 million compared with $168.6 million a year ago.

Guidance

American Outdoor Brands expects first-quarter fiscal 2018 non-GAAP earnings in the range of 7–12 cents per share. The company anticipates its revenues to be in the range of $140–$150 million.

For fiscal 2018, the company provided its non-GAAP earnings expectation in the band of $1.52–$1.62 per share. Revenues are expected in the range of $750–$790 million for the same period.

Peer Releases

Raytheon Company RTN reported first-quarter 2017 adjusted earnings from continuing operations of $1.73 per share, beating the Zacks Consensus Estimate by 7.5%. The company’s first-quarter revenues of $6,000 million also surpassed the Zacks Consensus Estimate by 2.7%. The company carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Rockwell Collins Inc.’s COL second-quarter fiscal 2017 (ended Mar 31, 2017) adjusted earnings per share of $1.34 surpassed the Zacks Consensus Estimate by 2.3%. Total sales were $1,342 million, beating the Zacks Consensus Estimate by 0.9%. The company carries a Zacks Rank #3 (Hold).

AAR Corp. AIR reported third-quarter fiscal 2017 earnings of 38 cents per share, which were in line with the Zacks Consensus Estimate. Net sales came in at $446.7 million, which beat the Zacks Consensus Estimate by 5.8%. This company also carries a Zacks Rank #3.

Zacks Rank

American Outdoor Brands currently carries a Zacks Rank #4 (Sell).

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