Why Invacare Stock Is Trading Lower After Q3 FY21 Outlook Update

  • Invacare Corporation's IVC stock plunged to a 52-week low after updating Q3 FY21 guidance.
  • The Company said that headwinds related to labor, material, and freight, will continue to impact its business.
  • Matt Monaghan, Chairman, President, and CEO, stated, "In the short-term, we expect to maintain elevated levels of inventory and incur higher conversion costs. Management is working with customers on price increases as appropriate to defray significantly higher input costs; however, the benefit of those actions will not be realized until 4Q21."
  • For Q3 FY21, Invacare expects constant currency net sales of 0% - 4% Y/Y, against the growth rate of 4% - 7% expected earlier.
  • The Company sees adjusted EBITDA of $6 million - $9 million, down from the previous outlook of $45 million.
  • The Company expects Free cash flow usage of $4 million - $7 million, versus free cash flow of $5 million.
  • Price Action: IVA shares are down 34.9% at $5.40 during the market session on the last check Thursday.
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