Espey Mfg. & Electronics Corp.: A Mixed Earnings Report for Q1 2025
Shares of Espey Mfg. & Electronics Corp. (ESP) experienced a 2.6% decline following the company’s earnings announcement for the first quarter ending September 30, 2024. This drop stands in contrast to the S&P 500 index, which fell by 0.8% during the same period. Furthermore, over the past month, Espey’s stock slipped by 0.7%, while the S&P 500 saw a positive change of 2.8%.
Strong Earnings, Despite Stock Price Drop
In the fiscal first quarter of 2025, Espey reported earnings per share of 61 cents, a marked increase from 44 cents a year earlier. This rise in earnings reflects the company’s enhanced operational efficiency and a beneficial product mix.
Net sales reached $10.4 million, showcasing a 21.9% increase compared to $8.6 million in the same quarter last year. This growth can be attributed to stronger sales fueled by a robust backlog of orders.
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Price, Consensus, and EPS Surprise Overview
Espey Mfg. & Electronics Corp. price-consensus-eps-surprise-chart | Espey Mfg. & Electronics Corp. Quote
Current Backlog and Orders
At the end of the quarter, Espey boasted a backlog of $94.6 million, an increase of 8.6% from $87.1 million the previous year. However, new orders for the fiscal first quarter saw a sharp decline, coming in at $7.8 million compared to $12.1 million a year earlier. Espey explained this downturn as a consequence of timing issues, emphasizing ongoing efforts to finalize larger contracts shortly.
Net income surged by 46% year-over-year, reaching $1.6 million, up from $1.1 million.
Insights from Management
CEO David O’Neil characterized the quarter’s outcomes as “excellent and on par with expectations.” He highlighted strong sales performance and consistent operational enhancements as key factors. The boost in earnings per share was mainly attributed to increased sales and a favorable mix of products. O’Neil also expressed optimism about the company’s potential to secure larger contracts, which could enhance annual order bookings compared to the prior year.
Challenges and Opportunities Ahead
Espey’s performance has been supported by its substantial backlog, signaling continued demand for its specialized military and industrial power supplies and transformers. The positive revenue growth and net income reflect the company’s ability to capitalize on strong bookings from previous years. Nevertheless, the drop in new orders may indicate potential revenue volatility, which the company aims to address by securing additional contracts.
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Espey Mfg. & Electronics Corp. (ESP): Free Stock Analysis Report
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