Advanced Drainage Systems Reports Earnings Miss, Investors Anticipate Future Changes
Advanced Drainage Systems (WMS) has reported quarterly earnings of $1.70 per share, falling short of the Zacks Consensus Estimate of $1.93. This result is a slight decrease compared to last year’s earnings of $1.71 per share, adjusted for non-recurring items.
The earnings surprise this quarter was -11.92%. In the previous quarter, the company was expected to report earnings of $1.98 per share but exceeded expectations with $2.06, resulting in a positive surprise of 4.04%.
Over the last year, Advanced Drainage has exceeded consensus EPS estimates three times out of four. This company, operating in the Zacks Building Products – Miscellaneous industry, reported revenues of $782.61 million for the quarter ending September 2024. This amount missed the Zacks Consensus Estimate by 4.33%, but showed a slight increase from revenues of $780.22 million in the same period last year. It is worth noting that it has outperformed revenue estimates in two of the last four quarters.
The future stock movement will largely depend on management’s insights during the upcoming earnings call regarding these results and projections for future earnings.
Since the start of the year, Advanced Drainage shares have climbed approximately 13.1%, which is considerably less than the S&P 500’s growth of 25.2%.
What Lies Ahead for Advanced Drainage?
Despite lagging behind the broader market, investors are keen to know what the future holds for Advanced Drainage stock.
Understanding the company’s earnings outlook is crucial, as it not only reflects current earnings expectations but also highlights any recent changes in these forecasts. Research indicates a strong relationship between short-term stock movements and the trends in earnings estimate revisions. Investors can independently track these revisions or use the reliable Zacks Rank rating system, known for its historical success in capitalizing on earnings estimate revisions.
Leading up to the latest earnings release, the trend for estimate revisions at Advanced Drainage has shown mixed signals. Depending on the latest earnings report’s details, this may influence the Zacks Rank, which currently stands at #3 (Hold) for the stock. This indicates that shares are projected to perform in line with the market soon. Investors can access a full list of Zacks #1 Rank (Strong Buy) stocks from their platform.
Looking ahead, changes in earnings estimates for the coming quarters will be closely monitored. Presently, the consensus EPS estimate stands at $1.54 with projected revenues of $690 million for the next quarter, and $6.95 with $3.01 billion in revenues for the current fiscal year.
It’s essential to recognize how the industry’s outlook influences stock performance. Currently, the Zacks Industry Rank places Building Products – Miscellaneous in the bottom 47% of over 250 industries. Historically, the top half of Zacks-ranked industries outperform the bottom half by more than two to one.
In the same industry, Construction Partners (ROAD) is also preparing to release its quarterly results. This company, focused on road and highway construction, is expected to report earnings of $0.57 per share, reflecting a year-over-year decline of 3.4%. The EPS estimate has been revised downward by 5.9% in the last month. Revenue forecasts for Construction Partners indicate $537.5 million, up 13.2% from the same quarter last year.
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Advanced Drainage Systems, Inc. (WMS): Free Stock Analysis Report
Construction Partners, Inc. (ROAD): Free Stock Analysis Report
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