The Valspar Corporation VAL said that its shareholders have voted in favor of the company's proposed acquisition by The Sherwin-Williams Co. SHW at the former’s Special Meeting of Shareholders.
The transaction is expected to conclude by the end of the first quarter of calendar year 2017. The deal is subject to customary closing conditions, including the expiration or termination of the applicable waiting period under the U.S. Hart-Scott-Rodino Antitrust Improvements Act and regulatory approvals in various other jurisdictions.
Valspar saw its profits decline roughly 9.2% year over year to 99 cents per share in second-quarter fiscal 2016 (ended Apr 29). Adjusted earnings of $1.22 per share missed the Zacks Consensus Estimate of $1.26. Revenues of $1.06 billion also trailed the Zacks Consensus Estimate of $1.12 billion. However, revenues from the paints segment saw an increase of 1% year over year to $407 million, although currency headwinds hurt sales by 2%.
Valspar, which is one of the prominent paint makers, along with Akzo Nobel AKZOY and PPG Industries PPG, withdrew its guidance for fiscal 2016 in May 2016 in light of the impending merger with Sherwin-Williams.
Valspar is exposed to currency headwinds and volatility in raw material costs which can invariably reduce the company's profit margins. Moreover, the overall demand environment remains uneven.
Valspar currently holds a Zacks Rank #4 (Sell).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Be the first to comment