Q3 Earnings Roundup: Astec (NASDAQ:ASTE) And The Rest Of The Heavy Machinery Segment

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Westinghouse Air Brake Technologies

+1.04%

Wabash National

+0.95%

Let’s dig into the relative performance of Astec and its peers as we unravel the now-completed Q3 heavy machinery earnings season.

Automation that increases efficiencies and connected equipment that collects analyzable data have been trending, creating new demand for heavy machinery and equipment companies. The gradual transition to clean energy also allows companies to innovate around emissions, potentially spurring replacement cycles that can accelerate revenue growth. On the other hand, heavy machinery companies are at the whim of economic cycles. Interest rates, for example, can greatly impact the commercial and residential construction that drives demand for these companies’ offerings.

The 21 heavy machinery stocks we track reported a mixed Q3. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.

In light of this news, share prices of the companies have held steady as they are up 4.3% on average since the latest earnings results.

Astec

Inventing the first ever double-barrel hot-mix asphalt plant, Astec provides machines and equipment for building roads, processing raw materials, and producing concrete.

Astec reported revenues of $350.1 million, up 20.1% year on year. This print exceeded analysts’ expectations by 5.8%. Overall, it was a strong quarter for the company with an impressive beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.

"We were pleased to post another strong quarter evidencing our focus on delivering consistent profitability and growth," said Jaco van der Merwe, Chief Executive Officer.

The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $46.44.

Best Q3: Caterpillar

With its iconic yellow machinery working on construction sites, Caterpillar manufactures construction equipment like bulldozers, excavators, and parts and maintenance services.

Caterpillar reported revenues of $17.64 billion, up 9.5% year on year, outperforming analysts’ expectations by 6.1%. The business had a stunning quarter with a solid beat of analysts’ organic revenue estimates and an impressive beat of analysts’ EBITDA estimates.

The market seems happy with the results as the stock is up 12.2% since reporting. It currently trades at $588.36.

Weakest Q3: Wabash

With its first trailer reportedly built on two sawhorses, Wabash offers semi trailers, liquid transportation containers, truck bodies, and equipment for moving goods.

Wabash reported revenues of $381.6 million, down 17.8% year on year, in line with analysts’ expectations. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations significantly and full-year EPS guidance missing analysts’ expectations significantly.

Wabash delivered the weakest full-year guidance update in the group. Interestingly, the stock is up 17.7% since the results and currently trades at $9.79.

Read our full analysis of Wabash’s results here.

Titan International

Acquiring Goodyear’s farm tire business in 2005, Titan (NSYE:TWI) is a manufacturer and supplier of wheels, tires, and undercarriages used in off-highway vehicles such as construction vehicles.

Titan International reported revenues of $466.5 million, up 4.1% year on year. This print surpassed analysts’ expectations by 1.7%. Overall, it was a strong quarter as it also recorded a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.

The stock is up 3.8% since reporting and currently trades at $8.26.

Read our full, actionable report on Titan International here, it’s free for active Edge members.

Wabtec

Also known as Wabtec, Westinghouse Air Brake Technologies provides equipment, systems, and related software for the railway industry.

Wabtec reported revenues of $2.89 billion, up 8.4% year on year. This result was in line with analysts’ expectations. Aside from that, it was a mixed quarter as it also recorded a solid beat of analysts’ adjusted operating income estimates but a miss of analysts’ organic revenue estimates.

The stock is up 7.8% since reporting and currently trades at $213.39.

Read our full, actionable report on Wabtec here, it’s free for active Edge members.

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U.S. stocks lower at close of trade; Dow Jones Industrial Average down 0.51%

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CCH Holdings Ltd. Ordinary Shares

+0.73%

Meta Platforms

+1.92%

Investing.com – U.S. stocks were lower after the close on Friday, as losses in the Technology, Industrials and Oil & Gas sectors led shares lower.

At the close in NYSE, the Dow Jones Industrial Average lost 0.51%, while the S&P 500 index fell 1.07%, and the NASDAQ Composite index lost 1.69%.

The best performers of the session on the Dow Jones Industrial Average were McDonald’s Corporation (NYSE:MCD), which rose 2.26% or 7.01 points to trade at 316.72 at the close. Meanwhile, Coca-Cola Co (NYSE:KO) added 2.04% or 1.41 points to end at 70.52 and Boeing Co (NYSE:BA) was up 1.83% or 3.67 points to 204.38 in late trade.

The worst performers of the session were Caterpillar Inc (NYSE:CAT), which fell 4.43% or 27.72 points to trade at 597.89 at the close. NVIDIA Corporation (NASDAQ:NVDA) declined 3.28% or 5.94 points to end at 174.99 and Goldman Sachs Group Inc (NYSE:GS) was down 2.50% or 22.77 points to 888.26.

The top performers on the S&P 500 were Lululemon Athletica Inc (NASDAQ:LULU) which rose 9.63% to 205.03, The Mosaic Company (NYSE:MOS) which was up 4.05% to settle at 26.21 and GE Aerospace (NYSE:GE) which gained 3.99% to close at 299.93.

The worst performers were Broadcom Inc (NASDAQ:AVGO) which was down 11.44% to 359.90 in late trade, Corning Incorporated (NYSE:GLW) which lost 7.97% to settle at 88.32 and Arista Networks (NYSE:ANET) which was down 7.17% to 124.76 at the close.

The top performers on the NASDAQ Composite were TryHard Holdings Ltd (NASDAQ:THH) which rose 57.72% to 15.52, NeoConcept International Group Holdings Ltd (NASDAQ:NCI) which was up 54.44% to settle at 1.92 and Canopy Growth Corp (NASDAQ:CGC) which gained 53.98% to close at 1.74.

The worst performers were Mingzhu Logistics Holdings Ltd (OTC:YGMZF) which was down 86.11% to 0.00 in late trade, CCH Holdings Ltd (NASDAQ:CCHH) which lost 82.47% to settle at 2.65 and Argo Blockchain PLC ADR (NASDAQ:ARBK) which was down 77.60% to 6.87 at the close.

Falling stocks outnumbered advancing ones on the New York Stock Exchange by 1813 to 941 and 77 ended unchanged; on the Nasdaq Stock Exchange, 2230 fell and 1122 advanced, while 181 ended unchanged.

Shares in Mingzhu Logistics Holdings Ltd (OTC:YGMZF) fell to all time lows; falling 86.11% or 0.02 to 0.00. Shares in CCH Holdings Ltd (NASDAQ:CCHH) fell to all time lows; down 82.47% or 12.47 to 2.65. Shares in Argo Blockchain PLC ADR (NASDAQ:ARBK) fell to all time lows; losing 77.60% or 23.81 to 6.87.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was up 6.06% to 15.75.

Gold Futures for February delivery was up 0.48% or 20.70 to $4,333.70 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in January fell 0.23% or 0.13 to hit $57.47 a barrel, while the February Brent oil contract fell 0.18% or 0.11 to trade at $61.17 a barrel.

EUR/USD was unchanged 0.01% to 1.17, while USD/JPY rose 0.14% to 155.83.

The US Dollar Index Futures was up 0.01% at 98.00.

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Avago, SanDisk among market cap stock movers on Friday

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Advanced Micro Devices

+2.79%

Friday’s market has seen swings in various stocks based on news and other factors. Today, stocks like Rivian Automotive and Lululemon Athletica are rallying, while stocks like Avago Technologies and SanDisk Corp-Exch are falling. Below are highlights of some of the biggest stock movers, from mega-caps to small caps.

Mega-Cap Movers (Market Cap:$200B+)

Avago Technologies (AVGO); Broadcom reports 28% revenue growth, raises dividend by 10% -11.15%
Micron Tech (MU) -5.39%
Applovin (APP) -4.59%
Lam Research Corp (LRCX) -4.39%
Adv Micro Device ( -3.97%
Oracle Corp (ORCL) -3.77%
Applied Matls Inc (AMAT); Applied Materials declares quarterly dividend of $0.46 per share -3.44%
Caterpillar (CAT) -1.96%
General Electric (GE) +4.21%
Mcdonalds (MCD) +2.1%

Large-Cap Stock Movers (Market Cap:$10-$200B)

SanDisk Corp-Exch (SNDK) -13.65%
Lumentum Holdings Inc (LITE) -11.67%
Fabrinet (FN) -9.87%
AltC Acquisition (OKLO) -9.22%
Rambus Inc (RMBS) -8.84%
Ciena (CIEN); Northland downgrades Ciena stock rating to Market Perform on valuation concerns -8.81%
Bloom Energy Corp (BE) -8.66%
Astera Labs (ALAB) -12.56%
Lululemon Athletica (LULU); Jefferies upgrades Lululemon stock rating to Hold amid CEO departure +10.23%
Rivian Automotive (RIVN) +14.67%

Mid-Cap Stock Movers (Market Cap:$2-$10B)

Fermi America LLC (FRMI) -30.73%
Arcus Biosciences Inc (RCUS) -13.37%
Modine Manufacturing Comp (MOD) -12.76%
Everus Construction (ECG) -11.16%
Fluence Energy (FLNC) -11.32%
Netskope Inc (NTSK); Netskope beats Q3 expectations as revenue jumps 33%, shares edge higher -11.28%
Solaris Oilfield Infrastructure (SEI) -13.79%
CF Acquisition Corp VI (RUMBW) -10.5%
Clear Secure (YOU); Clear Secure stock rating upgraded by JPMorgan on Amex partnership renewal +13.16%
WeShop Holdings Ltd (WSHP) +24.07%

Small-Cap Stock Movers (Market Cap:$300M-$2B)

Graphite Bio (LENZ) -24.06%
Arteris (AIP); Arteris to acquire cybersecurity firm Cycuity to enhance chip security -16.16%
Qilian International Holding Group (BGM) -14.53%
TryHard Holdings (THH) +52.64%
Tilray Inc (TLRY) +39.27%
Frequency Electro (FEIM) +29.31%
Sundial Growers Inc (SNDL) +24.29%
Polestar Automotive Holding Plc (PSNY) +20.32%
Village Farms O (VFF) +20.88%
Flame Acquisition (SOC) +13.12%

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This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Astec (ASTE): Buy, Sell, or Hold Post Q3 Earnings?

Stock Story

Astec Industries

+0.80%

Astec trades at $46.13 and has moved in lockstep with the market. Its shares have returned 14.2% over the last six months while the S&P 500 has gained 13.6%.

Is now the time to buy Astec, or should you be careful about including it in your portfolio? Check out our in-depth research report to see what our analysts have to say, it’s free for active Edge members.

Why Is Astec Not Exciting?

We don't have much confidence in Astec. Here are three reasons why ASTE doesn't excite us and a stock we'd rather own.

1. Backlog Declines as Orders Drop

Investors interested in Construction Machinery companies should track backlog in addition to reported revenue. This metric shows the value of outstanding orders that have not yet been executed or delivered, giving visibility into Astec’s future revenue streams.

Astec’s backlog came in at $449.5 million in the latest quarter, and it averaged 28.2% year-on-year declines over the last two years. This performance was underwhelming and shows the company is not winning new orders. It also suggests there may be increasing competition or market saturation.

2. Low Gross Margin Reveals Weak Structural Profitability

At StockStory, we prefer high gross margin businesses because they indicate the company has pricing power or differentiated products, giving it a chance to generate higher operating profits.

Astec has bad unit economics for an industrials company, giving it less room to reinvest and develop new offerings. As you can see below, it averaged a 23.9% gross margin over the last five years. Said differently, Astec had to pay a chunky $76.06 to its suppliers for every $100 in revenue.

3. Cash Burn Ignites Concerns

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Astec’s demanding reinvestments have drained its resources over the last five years, putting it in a pinch and limiting its ability to return capital to investors. Its free cash flow margin averaged negative 1.3%, meaning it lit $1.32 of cash on fire for every $100 in revenue.

Astec Trailing 12-Month Free Cash Flow Margin

Final Judgment

Astec isn’t a terrible business, but it doesn’t pass our bar. That said, the stock currently trades at 14.2× forward P/E (or $46.13 per share). This valuation multiple is fair, but we don’t have much faith in the company. We're fairly confident there are better investments elsewhere. Let us point you toward a fast-growing restaurant franchise with an A+ ranch dressing sauce.

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U.S. stocks higher at close of trade; Dow Jones Industrial Average up 1.05%

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Advanced Micro Devices

Investing.com – U.S. stocks were higher after the close on Wednesday, as gains in the Industrials, Basic Materials and Healthcare sectors led shares higher.

At the close in NYSE, the Dow Jones Industrial Average gained 1.05%, while the S&P 500 index climbed 0.68%, and the NASDAQ Composite index climbed 0.33%.

The best performers of the session on the Dow Jones Industrial Average were Nike Inc (NYSE:NKE), which rose 3.91% or 2.48 points to trade at 65.81 at the close. Meanwhile, Caterpillar Inc (NYSE:CAT) added 3.53% or 20.99 points to end at 615.35 and Johnson & Johnson (NYSE:JNJ) was up 3.29% or 6.58 points to 206.54 in late trade.

The worst performers of the session were Microsoft Corporation (NASDAQ:MSFT), which fell 2.78% or 13.70 points to trade at 478.56 at the close. Walmart Inc (NASDAQ:WMT) declined 1.66% or 1.91 points to end at 113.15 and Boeing Co (NYSE:BA) was down 0.82% or 1.65 points to 198.72.

The top performers on the S&P 500 were GE Vernova LLC (NYSE:GEV) which rose 15.59% to 722.77, Celanese Corporation (NYSE:CE) which was up 7.60% to settle at 43.26 and Western Digital Corporation (NASDAQ:WDC) which gained 7.32% to close at 181.95.

The worst performers were Uber Technologies Inc (NYSE:UBER) which was down 5.51% to 84.16 in late trade, Netflix Inc (NASDAQ:NFLX) which lost 4.15% to settle at 92.69 and HCA Holdings Inc (NYSE:HCA) which was down 4.05% to 468.73 at the close.

The top performers on the NASDAQ Composite were Beasley Broadcast Group Inc (NASDAQ:BBGI) which rose 302.17% to 16.69, Heartbeam Inc (NASDAQ:BEAT) which was up 94.29% to settle at 1.57 and Enveric Biosciences Inc (NASDAQ:ENVB) which gained 73.31% to close at 10.26.

The worst performers were Work Medical Technology Group Ltd (NASDAQ:WOK) which was down 96.59% to 0.19 in late trade, Agape ATP Corp (NASDAQ:ATPC) which lost 94.85% to settle at 0.07 and PomDoctor Ltd ADR (NASDAQ:POM) which was down 90.77% to 0.50 at the close.

Rising stocks outnumbered declining ones on the New York Stock Exchange by 1925 to 821 and 91 ended unchanged; on the Nasdaq Stock Exchange, 2119 rose and 1266 declined, while 167 ended unchanged.

Shares in GE Vernova LLC (NYSE:GEV) rose to all time highs; rising 15.59% or 97.47 to 722.77. Shares in Western Digital Corporation (NASDAQ:WDC) rose to all time highs; rising 7.32% or 12.41 to 181.95. Shares in Caterpillar Inc (NYSE:CAT) rose to all time highs; rising 3.53% or 20.99 to 615.35. Shares in Beasley Broadcast Group Inc (NASDAQ:BBGI) rose to 52-week highs; up 302.17% or 12.54 to 16.69. Shares in Work Medical Technology Group Ltd (NASDAQ:WOK) fell to all time lows; down 96.59% or 5.38 to 0.19. Shares in Agape ATP Corp (NASDAQ:ATPC) fell to all time lows; falling 94.85% or 1.25 to 0.07. Shares in PomDoctor Ltd ADR (NASDAQ:POM) fell to all time lows; losing 90.77% or 4.92 to 0.50.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 6.85% to 15.77.

Gold Futures for February delivery was up 0.49% or 20.75 to $4,256.95 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in January rose 1.17% or 0.68 to hit $58.93 a barrel, while the February Brent oil contract rose 1.11% or 0.69 to trade at $62.63 a barrel.

EUR/USD was up 0.58% to 1.17, while USD/JPY fell 0.47% to 156.04.

The US Dollar Index Futures was down 0.56% at 98.64.

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