Snap-On (NYSE:SNA) Posts Quarterly Earnings Results, Beats Expectations By $0.01 EPS

Key Points

• Snap-On beat quarterly earnings expectations, reporting EPS of $4.96 versus the $4.95 consensus. Revenue also came in above estimates at $1.24 billion, up 4.7% from a year earlier.
• The stock moved higher after the report, rising $1.85 to $408.02 in Thursday trading. Snap-On also remains financially solid, with a 21.28% net margin and 17.13% return on equity.
• Shareholder returns remain a focus, with the company paying a quarterly dividend of $2.44 per share and authorizing a $500 million stock buyback program. The dividend implies a 2.4% annual yield.

Snap-On (NYSE:SNA - Get Free Report) released its earnings results on Thursday. The company reported $4.96 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $4.95 by $0.01, FiscalAI reports. Snap-On had a net margin of 21.28% and a return on equity of 17.13%. The company had revenue of $1.24 billion for the quarter, compared to the consensus estimate of $1.22 billion. During the same period in the prior year, the company posted $4.72 EPS. The company's revenue was up 4.7% compared to the same quarter last year.

Snap-On Stock Performance

SNA traded up $1.85 during trading hours on Thursday, reaching $408.02. The company's stock had a trading volume of 41,396 shares, compared to its average volume of 367,939. Snap-On has a 52 week low of $312.78 and a 52 week high of $419.68. The company's 50-day moving average is $388.08 and its 200-day moving average is $377.89. The company has a debt-to-equity ratio of 0.15, a quick ratio of 2.74 and a current ratio of 3.53. The firm has a market cap of $21.14 billion, a PE ratio of 21.09, a price-to-earnings-growth ratio of 2.84 and a beta of 0.73.

Snap-On Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Wednesday, June 10th. Shareholders of record on Wednesday, May 20th were paid a $2.44 dividend. The ex-dividend date was Wednesday, May 20th. This represents a $9.76 annualized dividend and a yield of 2.4%. Snap-On's dividend payout ratio is currently 50.39%.

Snap-On declared that its Board of Directors has approved a stock buyback program on Thursday, April 30th that allows the company to buyback $500.00 million in shares. This buyback authorization allows the company to repurchase up to 2.5% of its stock through open market purchases. Stock buyback programs are often a sign that the company's management believes its stock is undervalued.

Insider Activity at Snap-On

In other news, CEO Nicholas T. Pinchuk sold 23,396 shares of the business's stock in a transaction that occurred on Tuesday, May 5th. The stock was sold at an average price of $375.77, for a total transaction of $8,791,514.92. Following the completion of the sale, the chief executive officer owned 856,918 shares in the company, valued at $322,004,076.86. The trade was a 2.66% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, SVP Jesus Arregui sold 4,251 shares of the stock in a transaction that occurred on Wednesday, June 10th. The stock was sold at an average price of $383.92, for a total value of $1,632,043.92. Following the transaction, the senior vice president owned 4,439 shares in the company, valued at approximately $1,704,220.88. This trade represents a 48.92% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 37,117 shares of company stock valued at $14,003,922 in the last ninety days. Company insiders own 3.80% of the company's stock.

Institutional Investors Weigh In On Snap-On

Hedge funds and other institutional investors have recently made changes to their positions in the business. DV Equities LLC acquired a new stake in shares of Snap-On during the 4th quarter worth $25,000. Quattro Advisors LLC bought a new stake in Snap-On during the fourth quarter worth about $35,000. MUFG Securities EMEA plc acquired a new stake in Snap-On during the second quarter worth about $48,000. Sfam LLC bought a new position in Snap-On in the 4th quarter valued at about $52,000. Finally, Los Angeles Capital Management LLC acquired a new stake in shares of Snap-On during the 4th quarter worth approximately $82,000. 84.88% of the stock is currently owned by institutional investors and hedge funds.

Analyst Ratings Changes

Several research analysts have weighed in on SNA shares. Barclays began coverage on Snap-On in a report on Thursday, May 28th. They set an "overweight" rating and a $420.00 target price on the stock. Weiss Ratings reaffirmed a "buy (b)" rating on shares of Snap-On in a research note on Friday, July 17th. Robert W. Baird boosted their price objective on shares of Snap-On from $380.00 to $395.00 and gave the stock a "neutral" rating in a research report on Friday, April 24th. Finally, Roth Capital restated a "buy" rating and set a $431.00 target price on shares of Snap-On in a report on Friday, April 24th. Five analysts have rated the stock with a Buy rating and one has issued a Hold rating to the company's stock. According to data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and a consensus price target of $408.20.

About Snap-On

Snap‑On Incorporated NYSE: SNA is a designer, manufacturer and marketer of tools, diagnostic equipment, repair information and shop equipment for professional users. The company's product range includes hand and power tools, tool storage and cabinets, diagnostic scan tools and software, shop equipment such as lifts and tire changers, and specialized specialty tools for automotive, aviation, marine and industrial applications. Snap‑On also offers information and workflow solutions that combine diagnostic data, repair procedures and parts information to support professional technicians.

Founded in 1920 and headquartered in Kenosha, Wisconsin, Snap‑On has established a long history in the professional tools market.

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