Gentex Corporation (NasdaqGS:GNTX) is scheduled to report Q3 earnings results before markets open for trading on October 23, 2020.
The company is expected to report earnings of $0.41/share on revenue of $459.4 million. The consensus earnings per share (EPS) of $0.41/share is based on a poll of 7 analysts and represents a decline in eps of −6.4% over the same quarter last year, when the company reported earnings of $0.44/share.
The revenue forecast of $459.4 million based on a poll of 7 analysts implies a year-over-year (YoY) decline in revenue of −3.8%. Last year the company reported $477.8 million in revenue for the quarter.
| Metric | Expected | Prior Year | YoY Change |
|---|---|---|---|
| Revenue | $459.39 | $477.76 | −3.8% |
| EPS | $0.41 | $0.44 | −6.4% |
Earnings Call Trends
Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and missed expectations 2 quarters.
What are your expectations from Gentex Corporation for earnings this quarter? Let us know in the comments!
| Quarter | Expected | Reported | Surprise | Result |
|---|---|---|---|---|
| Q2, 2020 | $0.13 | $0.02 | −84.3% | Missed |
| Q1, 2020 | $0.35 | $0.36 | 3.2% | Beat |
| Q4, 2019 | $0.37 | $0.39 | 4.5% | Beat |
| Q3, 2019 | $0.42 | $0.44 | 4.4% | Beat |
| Q2, 2019 | $0.40 | $0.42 | 5.4% | Beat |
| Q1, 2019 | $0.39 | $0.40 | 1.5% | Beat |
| Q4, 2018 | $0.44 | $0.41 | −6.0% | Missed |
| Q3, 2018 | $0.41 | $0.42 | 2.2% | Beat |
In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price did not react much to the update.
| Report Date | Price Day Prior | Price Next Day | Change % | Result |
|---|---|---|---|---|
| July 24, 2020 | $26.28 | $26.29 | 0.0% | Increase |
| April 24, 2020 | $23.23 | $24.13 | 3.9% | Increase |
| January 31, 2020 | $30.95 | $29.77 | −3.8% | Decline |
| October 18, 2019 | $27.59 | $27.95 | 1.3% | Increase |
The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −3.19, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.19 implies a 0.1% chance of earnings manipulation.
Fundamentals And Technical Analysis
Gentex Corporation is currently trading at $27.36/share, down −0.7% for the day. The company is trading at approximately 87.5% of its 52-week high of $31.27/share. The company’s stock price is up 4.1% since the last earnings report and up 0.1% over the previous week.
The company’s 14 Day Relative Price Index (RSI) of 55.43 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.
The current share price implies a price-to-earnings (P/E) multiple of 22.82 and a forward P/E multiple of 23.15.
Gentex Corporation’s current share price also implies a price-to-book (P/B) multiple of 3.69. The following table summarizes some other key fundamental ratios:
| Metric | Value |
|---|---|
| Last Reported Fiscal Period Key | FY2020.Q2 |
| Period End Date | June 30, 2020 |
| Stock Price (Current) | $27.36 |
| P/E Ratio | 22.8x |
| P/E Ratio (Fwd) | 23.2x |
| PEG Ratio | −0.8 |
| Total Debt / Total Capital | 1.1% |
| Levered Free Cash Flow | $355 million |
| EV / EBITDA | 14.0x |
Gentex Corporation is a mid-cap stock with a market capitalization of $6.725 billion and a total enterprise value of $6.388 billion. The company operates in the Consumer Discretionary sector and the Auto Components industry.
Gentex Corporation provides digital vision, connected car, dimmable glass, and fire protection products worldwide. It operates through Automotive Products and Other segments. The company designs, develops, manufactures, and markets automotive products, including interior and exterior electrochromic automatic-dimming rearview mirrors, automotive electronics, and non-automatic-dimming rearview mirrors for automotive passenger cars, light trucks, pick-up trucks, sport utility vehicles, and vans for original equipment manufacturers, automotive suppliers, and various aftermarket and accessory customers. It also manufactures and sells variable dimmable windows to aircraft manufacturers and airline operators. In addition, the company provides photoelectric smoke detectors and alarms, electrochemical carbon monoxide detectors and alarms, audible and visual signaling alarms, and bells and speakers used in fire detection systems in office buildings, hotels, and other commercial and residential establishments. It sells its fire protection products directly, as well as through sales managers and manufacturer representative organizations to fire protection and security product distributors, electrical wholesale houses, and original equipment manufacturers of fire protection systems. Gentex Corporation was founded in 1974 and is headquartered in Zeeland, Michigan.
