Yahoo Finance Why Is FMC (FMC) Down 0.8% Since Last Earnings Report?
It has been about a month since the last earnings report for FMC (FMC). Shares have lost about 0.8% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is FMC due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
FMC Corp's Earnings and Revenues Top Estimates in Q4
FMC Corp recorded earnings (as reported) of $2.17 per share in fourth-quarter 2022, up from $1.50 reported in the year-ago quarter.
Barring one-time items, adjusted earnings per share were $2.37, which topped the Zacks Consensus Estimate of $2.32.
Revenues were $1,622 million in the quarter, up around 15% from the year-ago quarter’s levels. The top line surpassed the Zacks Consensus Estimate of $1,503.8 million.
Revenues were driven by a 9% rise in volumes and an 8% contribution from price. The company benefited from strong performance across North America, Latin America and Europe, Middle East and Africa (EMEA) in the reported quarter. Strong pricing actions also more than offset cost inflation and currency headwinds.
Regional Sales Performance
Sales climbed 35% year over year in North America in the quarter on strong volume and pricing in the U.S. business.
Sales in Latin America rose 13% year over year in the reported quarter on strong pricing and continued market expansion.
Revenues were flat year over year in Asia in the fourth quarter. In Australia, overwatch herbicide continued to gain share on cereals.
In EMEA, sales rose 7% year over year in the reported quarter on the back of strong pricing, expanded market access and broad-based demand, particularly in cereal herbicides.
FY22 Results
Earnings for full-year 2022 were $5.81 per share compared with $5.73 per share a year ago. Net sales went up around 15% year over year to $5,802.3 billion.
Financials
The company had cash and cash equivalents of $572 million at the end of 2022, up roughly 11% year over year. Long-term debt was $2,733.2 million, essentially flat year over year.
Guidance
For 2023, FMC sees revenues to the range of $6.08-$6.22 billion, indicating a rise of 6% at the midpoint from 2022 levels. Sales are expected to be driven by higher volumes on new launches and market access and strong prices in all regions. It envisions its pricing actions to be supported by a favorable market environment for 2023. FMC also expects continued healthy demand for its synthetic and biological product portfolios.
The company also expects adjusted EBITDA in the band of $1.48-$1.56 billion for 2023, indicating an 8% rise at the midpoint from 2022 levels.
FMC also projects adjusted earnings per share for 2023 in the range of $7.20-$8.00, suggesting an increase of 3% at the midpoint from the 2022 level.
Free cash flow for 2023 is projected to be $530-$720 million.
The company also sees first-quarter 2023 revenues in the range of $1.41-$1.45 billion, reflecting a 6% rise at the midpoint compared with the prior-year quarter’s levels. Adjusted earnings are forecast in the range of $1.63-$1.83 per share, representing a decline of 8% at the midpoint from the prior-year quarter’s levels. It also expects adjusted EBITDA in the range of $345-$365 million for the quarter, flat at the midpoint from the prior-year quarter’s levels.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -5.15% due to these changes.
VGM Scores
At this time, FMC has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise FMC has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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