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CIRCOR International (NYSE:CIR) Q3 2020 Earnings Prep

in EARNINGS/INVESTING IDEAS by

CIRCOR International, Inc. (NYSE:CIR) is scheduled to report Q3 earnings results before markets open for trading on November 5, 2020.

The company is expected to report earnings of $0.31/share on revenue of $186.9 million. The consensus earnings per share (EPS) of $0.31/share is based on a poll of 4 analysts and represents a decline in eps of −51.3% over the same quarter last year, when the company reported earnings of $0.63/share.

The revenue forecast of $186.9 million based on a poll of 3 analysts implies a year-over-year (YoY) decline in revenue of −21.2%. Last year the company reported $237.1 million in revenue for the quarter.

Expected to report EPS contraction of −51.3% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $186.85 $237.10 −21.2%
EPS $0.31 $0.63 −51.3%

Earnings Call Trends

Historically, management has exceeded analyst expectations 5 out of the last 8 tracked quarters, missed 2 quarters, and met expectations 1 quarter.

What are your expectations from CIRCOR International, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.11 $0.22 100.4% Beat
Q1, 2020 $0.45 $0.20 −55.8% Missed
Q4, 2019 $0.77 $0.82 6.4% Beat
Q3, 2019 $0.47 $0.63 32.7% Beat
Q2, 2019 $0.44 $0.45 2.2% Beat
Q1, 2019 $0.38 $0.38 0% Met
Q4, 2018 $0.60 $0.62 3.0% Beat
Q3, 2018 $0.53 $0.52 −1.3% Missed

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 28, 2020, the stock price reacted by increasing 7.0%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 7, 2020 $30.18 $32.30 7.0% Increase
May 29, 2020 $15.95 $16.08 0.8% Increase
March 2, 2020 $35.98 $36.83 2.4% Increase
November 6, 2019 $39.95 $41.50 3.9% 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 −3.04, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.04 implies a 0.1% chance of earnings manipulation.

Fundamentals And Technical Analysis

CIRCOR International, Inc. is currently trading at $27.90/share, up 3.3% for the day. The company is trading at approximately 59.6% of its 52-week high of $46.79/share. The company’s stock price is down −13.6% since the last earnings report and down −6.7% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 45.90 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:CIR Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −5.42 and a forward P/E multiple of 20.61.

CIRCOR International, Inc.’s current share price also implies a price-to-book (P/B) multiple of 2.04. The following table summarizes some other key fundamental ratios:

Data as of November 1, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 28, 2020
Stock Price (Current) $27.90
P/E Ratio −5.4x
P/E Ratio (Fwd) 20.6x
PEG Ratio 0.0
Total Debt / Total Capital 52.2%
Levered Free Cash Flow -$37.332 million
EV / EBITDA 9.7x

Finbox

CIRCOR International, Inc. is a small-cap stock with a market capitalization of $557.9 million and a total enterprise value of $1.02 billion. The company operates in the Industrials sector and the Machinery industry.

CIRCOR International, Inc. provides flow control products and services for the industrial and aerospace, and defense markets. The company has a product portfolio of brands serving its customers’ demanding applications. It operates through two segments, Aerospace & Defense and Industrial. The Aerospace & Defense segment manufactures and markets control valves, automatic recirculation valves, regulators, fluid controls, actuation systems, landing gear components, pneumatic controls, electro-mechanical controls, and other flow control products and systems. Its products and services are used in the military and defense, commercial aerospace, business and general aviation, and general industrial markets, as well as serves aircraft manufacturers and tier 1 suppliers to aircraft manufacturers. The Industrial segment provides 3 and 2 screw pumps, progressing cavity pumps, specialty centrifugal pumps, and gear metering pumps; automatic recirculation valves; and general service control valves for the end-users and original equipment manufacturers, as well as engineering, procurement, and construction companies. The company has operations in Europe, the Middle East, Africa, North America, and internationally. The company markets its solutions directly and through various sales partners to approximately 14,000 customers in approximately 100 countries. CIRCOR International, Inc. was founded in 1999 and is headquartered in Burlington, Massachusetts.

Expertise: financial modeling, mergers & acquisitions. Andy is also a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to do investment research. Andy’s background is in investment banking where he led the analysis on over 50 board advisory engagements involving mergers and acquisitions, fairness opinions and solvency opinions. Some of his board advisory highlights: - Sears Holdings Corp.’s $620 mm spin-off via rights offering of Sears Outlet, Hometown Stores and Sears Hardware Stores. - Cerberus Capital Management’s $3.3 bn acquisition of SUPERVALU Inc.’s New Albertsons, Inc. assets. Andy can be reached at andy@finbox.io or at +1 (516) 778-6257.

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