Why Electrical & Infrastructure Company Atkore Stock Is Sliding Today

Atkore Inc ATKR reported a Q4 FY23 revenue decline of 15.5% Y/Y to $869.9 million, missing the consensus of $920.4 million.

Revenue decreased Y/Y due to lower average selling prices of $173.8 million on expected pricing normalization and the economic value of solar tax credits to be transferred to certain customers of $14.5 million. 

Revenue declined 18.3% Y/Y in Electrical and 5.8% Y/Y in Safety & Infrastructure segments in Q3.

Adjusted EBITDA fell 28.6% Y/Y to $232.0 million on a decline across both the segments. Adjusted EBITDA margin contracted 490bps Y/Y to 26.7% in the quarter.

Adj. EPS of $4.21 topped the consensus of $4.08. 

In FY23, operating cash flow stood at $807.6 million, and cash and cash equivalents came in at $388.1 million.

Dividend: The company's Board of Directors approved a new quarterly dividend program and expects the first quarterly cash distribution to be declared and paid in CY Q1 2024, following the earnings announcement.

Outlook: For FY24, Atkore expects net sales of $3.50 billion - $3.65 billion vs. consensus of $3.61 billion and adjusted EPS of $16.00-$17.00 vs. $16.47 estimate.

For Q1 FY24, the company projects adj. EBITDA of $200 - $210 million and adj. EPS of $3.50 - $3.70 vs. consensus of $3.66. Atkore maintained its FY25 adj. EPS target of greater than $18.00.

Also Read: Atkore Gears Up For Q4 Print; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call

Price Action: ATKR shares are trading lower by 8.3% at $124 on the last check Friday.

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