Why Atkore Stock Rallied 14% in Morning Trading Today

What happened

shares repeatedly (NYSE: ATKR), the manufacturer with an eclectic array of electrical, safety and infrastructure products, was up more than 14% at some point on Monday morning. The big story here was the earnings, which investors clearly loved. Below is a summary of the important numbers.

so what

Atkore’s top end reached $840.8 million in the first quarter of 2022. This was 64.5% higher compared to $511.1 million brought in in the same quarter of fiscal 2021. Revenue advanced in the larger electrical division (about 75% of quarterly sales ) by approximately 65%. The smaller Safety and Infrastructure business (rest of sales) saw revenue increase of 60.7%. Simply put, they both made a significant quarter compared to the previous year. But the good news didn’t stop there. In the end, Atkore’s earnings per share rose to $4.58 per share. That’s a whopping $2.70 per share, more than it made in the first quarter of fiscal 2021. It beat its internal earnings target by a wide margin.

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Image source: Getty Images.

Management also noted that despite the challenging operating market (inflation and supply chain issues likely to affect nearly every company), Atkore was able to increase margins in each of its divisions. Moreover, it has highlighted the external sales force and revenue improvement in the data center market. It also announced the completion of the merger of two acquisitions, Sasco Tubes & Roll Forming and Four Star Industries, which together have added new capabilities to the company’s portfolio. It was, overall, a very positive quarterly update.

What now

In addition to all this good news, Atkore also increased its full-year guidance for adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) and earnings per share. The changes were also significant, with adjusted EBITDA increasing from a range of $650 million to $700 million, when it announced 2021 results in November, to $875 million to $925 million. The earnings guidance increased from a range of $9.20 per share to $10 per share to a much greater level of $12.80 to $13.60 per share. No wonder investors were in an upbeat mood here.

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Reuben Gregg Brewer has no position in any of the stocks mentioned. The Motley Fool does not have a position in any of the stocks mentioned. Motley Fool has a disclosure policy.

The opinions and opinions expressed here are those of the author and do not necessarily reflect the views and opinions of Nasdaq, Inc.

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