Friday, November 01, 2024
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Adjusted Results. Adjusted net loss during the quarter was $2.5 million, or $0.05 per share compared to adjusted net income of $0.1 million or $0.01 last year. Adjusted EBITDA was $11.6 million, or a margin of 10.2%, compared to last year’s $14.5 million or 11.6%. Both items were impacted by the Company’s rationalization of plants undergoing turnarounds and the sale of the Lubbock plastic plant operations.
Accelerated Transformation. Management has been accelerating its transformation initiatives, as the Company continues to win business, nearing the lower end of guidance for the year, and is continuously undergoing cost reduction, including $2 million in annualized cost savings enacted in the third quarter. New business wins bring over higher margins for NN at over 20% compared to the legacy business at around 11%, providing higher gross margins overtime as legacy contracts become more offset.
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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
