Beacon Roofing Supply (BECN) Surpasses Q2 Earnings and Revenue Estimates – May 6, 2021
Beacon Roofing Supply (BECN – Free Report) came in with quarterly earnings of $ 0.23 per share, beating the Zacks Consensus Estimate of $ 0.01 per share. This compares to a loss of $ 0.27 per share a year ago. These figures have been adjusted for one-off items.
This quarterly report represents a profit surprise of 2,200%. A quarter ago, this roofing materials distributor was expected to make a profit of $ 0.64 per share while actually generating a profit of $ 0.92, yielding a surprise of 43.75%.
In the past four quarters, the company has surpassed consensus WPA estimates four times.
Beacon Roofing, which belongs to the Zacks Building Products – Retail industry, posted sales of $ 1.32 billion for the quarter ended March 2021, surpassing the Zacks Consensus Estimate by 0.10%. This compared to year-ago revenues of $ 1.46 billion. The company has three times exceeded consensus revenue expectations in the past four quarters.
The sustainability of the stock’s immediate price movement based on the recently released numbers and future earnings expectations will largely depend on management’s comments on the earnings call.
Shares of Beacon Roofing have added approximately 42.3% since the start of the year from the 11% gain of the S&P 500.
What’s next for Beacon Roofing?
While Beacon Roofing has outperformed the market so far this year, the question that arises among investors is, what’s next for the stock?
There are no easy answers to this important question, but a reliable measure that can help investors address it is the company’s earnings outlook. This includes not only current consensus earnings expectations for the coming quarter (years), but also how these expectations have changed recently.
Empirical research shows a strong correlation between short-term stock movements and trends in earnings estimate revisions. Investors can monitor such revisions themselves or rely on a time-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.
Ahead of this revenue release, the trend of estimation revisions for Beacon Roofing has been mixed. While the size and direction of estimate revisions may change after the company’s just released earnings report, its current status translates into a Zacks Rank # 3 (Hold) for the stock. It is therefore expected that the shares will perform in line with the market in the near future. You can view the full list of the current Zacks # 1 Rank (Strong Buy) stocks here.
It will be interesting to see how the estimates for the coming quarters and the current fiscal year change in the coming days. The current consensus estimate of earnings per share is $ 1.04 on $ 1.7 billion in revenue for the next quarter and $ 3.17 on $ 6.46 billion in revenue for the current fiscal year.
Investors should be aware that the outlook for the industry can also have a material impact on the performance of the stock. In terms of the Zacks Industry Rank, Building Products – Retail is currently in the top 41% of the 250 plus Zacks industries. Our research shows that the top 50% of industries ranked by Zacks outperform the bottom 50% by a factor of more than 2 to 1.