JP Morgan On H.B. Fuller Post 4Q Results

JP Morgan has published a research report on H.B. Fuller FUL after the company had reported its 4Q earnings results ending November 27th. In the report, JP Morgan writes "The difference between reported results and our estimate was due to a lower-than-expected tax rate ($0.03) and higher-than-expected equity income ($0.01). The reported tax rate of 30.1% compared to our forecast of 34.0%. Consolidated operating income of $33.0M was consistent with our forecast of $33.3M. Fuller's volume growth for the quarter was surprisingly low and its pricing surprisingly high. Fuller reported consolidated sales of $360M versus our forecast of $362M: consolidated volumes improved 0.8% y-o-y (vs. our forecast of 4.8%), prices were up 4.8% (vs. our expectations of 3.2%), and currencies were a headwind of (1.6%) versus our (3.0%) expectation. Gross margin of 28.6% vs. 31.2% in the year-ago period and 28.4% in the prior quarter reflects an estimated 9% y-o-y increase in raw material costs. SG&A expenses (adjusted to exclude nonrecurring severance costs) of $70.0M compared to $71.7M in the prior-year period." JP Morgan maintains its Neutral rating on H.B. Fuller, which closed yesterday at $19.98.