TriMas (NASDAQ:TRS) Announces Earnings Results

Key Points

• TriMas exceeded quarterly expectations, reporting EPS of $0.50 versus the $0.48 consensus and revenue of $178.7 million versus $175.2 million expected. Management reaffirmed full-year adjusted EPS guidance of $1.60–$1.70.
• Packaging performance improved, with sales up 8.8% and operating margins expanding to 13.8%, while Specialty Products remained weak due to downtime, productivity issues and higher steel costs; its full-year margin outlook was reduced to 4%–6%.
• The company continues to strengthen shareholder returns, having repurchased nearly $184 million of shares since the Aerospace divestiture and declaring a quarterly dividend of $0.04. Analysts maintain a “Moderate Buy” consensus with a $41.50 average price target.

TriMas (NASDAQ:TRS - Get Free Report) released its quarterly earnings data on Thursday. The industrial products company reported $0.50 EPS for the quarter, topping the consensus estimate of $0.48 by $0.02, Briefing.com reports. TriMas had a return on equity of 6.41% and a net margin of 104.22%. The firm had revenue of $178.74 million for the quarter, compared to the consensus estimate of $175.16 million. During the same quarter in the previous year, the business earned $0.61 earnings per share. The company's quarterly revenue was down 33.6% on a year-over-year basis.

Here are the key takeaways from TriMas' conference call:

• Third-quarter results improved sharply: sales rose 7.7% to $178.7 million, operating profit increased 47.9%, and adjusted EPS reached $0.50 versus $0.17 a year earlier. Management reaffirmed full-year adjusted EPS guidance of $1.60–$1.70.
• Packaging delivered 8.8% sales growth and a 40-basis-point margin expansion to 13.8%, supported by broad-based demand, productivity gains, and cost reductions. The company now expects full-year Packaging operating margins of nearly 14%.
• Specialty Products profitability remained under pressure, with operating profit falling to $0.1 million from $2.4 million due to equipment downtime, low labor productivity, throughput constraints, and higher steel costs. Management lowered its full-year Specialty Products margin outlook to 4%–6%, although it expects improvement in the fourth quarter.
• TriMas ended the quarter with more than $1.1 billion in cash and approximately $761 million of net cash, while repurchasing nearly $184 million of shares since the Aerospace divestiture. More than 5% of shares outstanding have been reduced year to date, with approximately $67 million remaining under the authorization.
• The planned sale of the below-average-margin Rapak flexible bag-in-box business is expected to close in early November, sharpening the company’s portfolio focus and improving its Packaging mix. However, management continues to take a disciplined approach to deploying remaining Aerospace proceeds and announced no acquisition.

TriMas Trading Down 1.4%

Shares of TRS traded down $0.54 during mid-day trading on Thursday, reaching $38.82. 250,860 shares of the company were exchanged, compared to its average volume of 438,795. The business has a 50 day simple moving average of $38.95 and a two-hundred day simple moving average of $38.59. The company has a debt-to-equity ratio of 0.28, a quick ratio of 5.03 and a current ratio of 5.44. The stock has a market capitalization of $1.39 billion, a PE ratio of 1.62 and a beta of 0.61. TriMas has a 52 week low of $30.43 and a 52 week high of $45.42.

TriMas Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Thursday, November 12th. Stockholders of record on Thursday, November 5th will be paid a $0.04 dividend. The ex-dividend date of this dividend is Thursday, November 5th. This represents a $0.16 annualized dividend and a dividend yield of 0.4%. TriMas's dividend payout ratio is presently 0.67%.

Analysts Set New Price Targets

TRS has been the subject of a number of recent research reports. BWS Financial restated a "buy" rating and set a $45.00 price objective on shares of TriMas in a research note on Monday, August 3rd. Wall Street Zen raised shares of TriMas from a "sell" rating to a "hold" rating in a research note on Saturday, August 29th. Finally, Weiss Ratings raised TriMas from a "buy (b-)" rating to a "buy (b)" rating in a research note on Thursday, October 8th. Three investment analysts have rated the stock with a Buy rating and one has given a Hold rating to the company's stock. According to data from MarketBeat.com, TriMas currently has an average rating of "Moderate Buy" and a consensus price target of $41.50.

About TriMas

TriMas Corporation NASDAQ: TRS is a diversified manufacturer that develops and produces engineered products for the packaging, aerospace and industrial markets. The company serves customers through three primary business segments: TriMas Packaging, TriMas Aerospace and TriMas Specialty Products.

TriMas Packaging manufactures dispensing systems, closures, bottles, jars, cartridges and other packaging components used in consumer, industrial, food, beverage, healthcare and personal-care applications.

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