Perimeter Solutions (NYSE:PRM) Stock Crosses Above 50 Day Moving Average After Earnings Miss

Key Points

• Revenue beat estimates, but earnings missed: Perimeter Solutions reported quarterly revenue of $389.9 million versus expectations of about $381.5 million, while adjusted EPS of $0.85 came in below analyst estimates of $0.95–$0.96.
• Shares moved above their 50-day average: The stock traded as high as $29.94 and last changed hands at $29.54, above its 50-day moving average of $29.02.
• Investors face mixed signals: Adjusted EBITDA was $223.5 million, but management expects a period of “distressed adjusted EBITDA” at PDI. Analysts’ consensus rating is “Moderate Buy,” with an average price target of $41.50.

Perimeter Solutions, SA (NYSE:PRM - Get Free Report)'s share price passed above its 50 day moving average during trading on Friday following a stronger than expected earnings report. The stock has a 50 day moving average of $29.02 and traded as high as $29.94. Perimeter Solutions shares last traded at $29.5390, with a volume of 2,151,445 shares traded.

The company reported $0.85 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.96 by ($0.11). The business had revenue of $389.87 million during the quarter, compared to the consensus estimate of $381.45 million. Perimeter Solutions had a negative net margin of 44.86% and a positive return on equity of 19.15%.

Perimeter Solutions News Summary

Here are the key news stories impacting Perimeter Solutions this week:

• Positive Sentiment: Third-quarter revenue was $389.9 million, above the roughly $381.5 million analyst estimate. Adjusted EBITDA was $223.5 million, which the company attributed to continued execution on its value drivers and recent acquisitions. Company earnings release
• Neutral Sentiment: The company outlined an annual capital-spending plan of $30 million to $40 million. This signals continued investment, though it also means ongoing capital requirements. Capex plan and PDI outlook
• Negative Sentiment: Adjusted EPS of $0.85 fell short of analyst estimates of $0.95–$0.96, tempering the revenue beat. Management also expects a period of “distressed adjusted EBITDA” at PDI, a business-level concern investors may monitor. Q3 earnings miss

Wall Street Analyst Weigh In

A number of equities research analysts have weighed in on the company. Wall Street Zen cut Perimeter Solutions from a "buy" rating to a "hold" rating in a research note on Sunday, July 12th. Weiss Ratings raised Perimeter Solutions from a "sell (d)" rating to a "sell (d+)" rating in a research report on Monday, October 19th. JPMorgan Chase & Co. lowered their price target on Perimeter Solutions from $45.00 to $40.00 and set an "overweight" rating on the stock in a research report on Tuesday, October 13th. Zacks Research upgraded shares of Perimeter Solutions from a "strong sell" rating to a "hold" rating in a report on Thursday, October 15th. Finally, UBS Group cut their price objective on Perimeter Solutions from $42.00 to $38.00 and set a "buy" rating for the company in a research report on Tuesday, September 29th. Four investment analysts have rated the stock with a Buy rating, one has given a Hold rating and one has given a Sell rating to the stock. According to MarketBeat, the stock presently has an average rating of "Moderate Buy" and an average target price of $41.50.

Institutional Inflows and Outflows

Several institutional investors have recently made changes to their positions in the company. Principal Financial Group Inc. lifted its position in shares of Perimeter Solutions by 15.0% during the 1st quarter. Principal Financial Group Inc. now owns 12,513,159 shares of the company's stock valued at $305,572,000 after buying an additional 1,634,158 shares in the last quarter. Wellington Management Group LLP acquired a new stake in shares of Perimeter Solutions in the 2nd quarter valued at about $22,162,000. Renaissance Technologies LLC raised its position in Perimeter Solutions by 2,744.1% during the 1st quarter. Renaissance Technologies LLC now owns 591,257 shares of the company's stock worth $14,438,000 after buying an additional 570,468 shares during the last quarter. Conestoga Capital Advisors LLC grew its holdings in shares of Perimeter Solutions by 101.9% in the 3rd quarter. Conestoga Capital Advisors LLC now owns 1,081,985 shares of the company's stock worth $28,478,000 after acquiring an additional 546,020 shares during the period. Finally, Weitz Investment Management Inc. acquired a new stake in Perimeter Solutions during the second quarter worth approximately $16,072,000. Institutional investors own 89.93% of the company's stock.

Perimeter Solutions Stock Performance

The stock's 50-day moving average is $29.02 and its 200-day moving average is $29.59. The stock has a market cap of $4.84 billion, a price-to-earnings ratio of 227.24 and a beta of 1.91. The company has a current ratio of 1.57, a quick ratio of 0.93 and a debt-to-equity ratio of 1.19.

About Perimeter Solutions

Perimeter Solutions, Inc NYSE: PRM is a specialty chemicals and fire-safety company that develops and supplies products used to prevent, control and suppress fires, as well as chemicals used in industrial applications. Its operations are organized primarily around fire-safety products and performance chemicals.

The company's fire-safety portfolio includes PHOS-CHEK-branded wildfire retardants, firefighting foams, gels and other suppression products. These solutions are used by government agencies, fire departments, aviation and industrial customers, and other organizations involved in wildfire response, emergency preparedness and fire protection.

Perimeter Solutions also produces phosphorus-based specialty chemicals, including phosphorus pentasulfide, which is used in applications such as lubricant additives and other industrial processes.

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