Let’s dig into the relative performance of Middleby (NASDAQ:MIDD) and its peers as we unravel the now-completed Q3 professional tools and equipment earnings season.
Automation that increases efficiency and connected equipment that collects analyzable data have been trending, creating new demand. Some professional tools and equipment companies also provide software to accompany measurement or automated machinery, adding a stream of recurring revenues to their businesses. On the other hand, professional tools and equipment companies are at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.
The 9 professional tools and equipment stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 2.1% while next quarter’s revenue guidance was in line.
In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.
Middleby (NASDAQ:MIDD)
Holding a Guinness World Record for creating the world’s fastest conveyor pizza oven, Middleby (NYSE:MIDD) is a food service and equipment manufacturer.
Middleby reported revenues of $982.1 million, up 4.2% year on year. This print exceeded analysts’ expectations by 2.2%. Overall, it was a strong quarter for the company with an impressive beat of analysts’ revenue estimates and a beat of analysts’ EPS estimates.
The stock is down 4% since reporting and currently trades at $118.60.
Is now the time to buy Middleby? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q3: Kennametal (NYSE:KMT)
Involved in manufacturing hard tips of anti-tank projectiles in World War II, Kennametal (NYSE:KMT) is a provider of industrial materials and tools for various sectors.
Kennametal reported revenues of $498 million, up 3.3% year on year, outperforming analysts’ expectations by 4.3%. The business had an incredible quarter with a solid beat of analysts’ organic revenue estimates and EPS guidance for next quarter exceeding analysts’ expectations.
Kennametal delivered the highest full-year guidance raise among its peers. The market seems happy with the results as the stock is up 24.2% since reporting. It currently trades at $27.46.
Is now the time to buy Kennametal? Access our full analysis of the earnings results here, it’s free for active Edge members.
Slowest Q3: Stanley Black & Decker (NYSE:SWK)
With an iconic “STANLEY” logo which has remained virtually unchanged for over a century, Stanley Black & Decker (NYSE:SWK) is a manufacturer primarily catering to the tool and outdoor equipment industry.
Stanley Black & Decker reported revenues of $3.76 billion, flat year on year, in line with analysts’ expectations. It was a mixed quarter as it posted a beat of analysts’ EPS estimates but full-year EPS guidance slightly missing analysts’ expectations.
Stanley Black & Decker delivered the weakest performance against analyst estimates in the group. Interestingly, the stock is up 6.3% since the results and currently trades at $70.53.
Read our full analysis of Stanley Black & Decker’s results here.
Hillman (NASDAQ:HLMN)
Established when Max Hillman purchased a franchise operation, Hillman (NASDAQ:HLMN) designs, manufactures, and sells industrial equipment and systems for various sectors.
Hillman reported revenues of $424.9 million, up 8% year on year. This print met analysts’ expectations. It was a strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
Hillman had the weakest full-year guidance update among its peers. The stock is down 6% since reporting and currently trades at $8.73.
Read our full, actionable report on Hillman here, it’s free for active Edge members.
Lincoln Electric (NASDAQ:LECO)
Headquartered in Ohio, Lincoln Electric (NASDAQ:LECO) manufactures and sells welding equipment for various industries.
Lincoln Electric reported revenues of $1.06 billion, up 7.9% year on year. This result surpassed analysts’ expectations by 1.6%. More broadly, it was a satisfactory quarter as it also produced a solid beat of analysts’ organic revenue estimates but a slight miss of analysts’ EBITDA estimates.
The stock is flat since reporting and currently trades at $236.81.
Read our full, actionable report on Lincoln Electric here, it’s free for active Edge members.
Market Update
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% in November), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by potential trade policy changes and corporate tax discussions, which could impact business confidence and growth. The path forward holds both optimism and caution as new policies take shape.
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