Headquartered in Kenosha, WI, Snap-on Incorporated SNA is a global provider of professional tools, equipment, and related solutions for technicians, vehicle service centers, original equipment manufacturers and other industrial users. The company divides its operations in four segments: Snap-on Tools Group, Commercial & Industrial Group, Repair Systems & Information Group and Financial Services segment.
Snap-on’s Repair Systems & Information segment has been gaining traction on the back of factors like rising penetration in emerging markets, continued software and hardware upgrades, productivity enhancements. In this segment, undercar equipment is an important, high visibility and high-value product line for the company and has been major revenue driver since the past quarters. It allows Snap-on to clearly showcase its advantage in innovation, thus helping the company improve its position in Asia Pacific.
However, strengthening of U.S. Dollar and macroeconomic turbulences continue to bother the company’s financials. Around one-third of the company’s revenues are derived from its European businesses, which continue to be impacted by weakness in Eastern Europe, Greece and Russia, thereby providing limited visibility regarding the company’s future performance. Apart from Europe, Snap-on has been suffering from prevailing sluggishness in markets like Japan and Middle-East.
Investors should also note the recent earnings estimate revisions for SNA, as the consensus estimate has upped in the last 30 days. Also, SNA has an excellent earnings track record with the company delivering positive average earnings surprise of 5.55%, in the last four trailing quarters, beating the estimates all through.
Currently, SNA has a Zacks Rank #3 (Hold) but that could change following its third quarter 2015 earnings report which has just released. We have highlighted some of the key details from the just-released announcement below:
Earnings: SNA beats on earnings. Net earnings per share came in at $1.98 higher than the Zacks Consensus Estimate of $1.93.
Revenue: Net sales of $821.5 million came below the Zacks Consensus Estimate of $840 million.
Key Stats: Strong increases in organic sales and operating earnings before financial services drove the results. Results also benefitted from Snap-on Value Creation Processes as well as breakthrough innovations.
Stock Price: SNA shares were inactive following the release. It would be interesting to see how the market reacts to the results during the trading session today.
Check back later for our full write up on this SNA earnings report later!
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