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Pentair (PNR) Issues Preliminary Q1 Results, Trims Guidance

Pentair Plc PNR has issued preliminary results for first-quarter 2019. Adjusted earnings per share (EPS) came in at 43 cents in the quarter compared to the 49 cents recorded in the prior-year quarter. Adjusted earnings fell short of the first-quarter guidance of 52-55 cents. Pentair’s performance was impacted by adverse weather conditions in higher margin Aquatics and agricultural-related business.

EPS, including special items, came in at 30 cents per share compared with the 32 cents reported in the year-ago quarter. EPS was down from the guidance of 47-50 cents.

Further, sales during the quarter were down 6% year over year to $689 million, lower than the prior guidance of flat to up 1%. Excluding the impact of acquisitions, divestitures and currency translation, core sales were down 4% in the reported quarter. Pentair’s earlier guidance of core sales growth was at 4-5% year over year.
Considering the preliminary first-quarter results, Pentair has slashed its earnings and sales guidance for the current year. The company now estimates adjusted EPS of $2.30-$2.35, down from the prior view of $2.50-$2.60. EPS, including special items, is expected in the range of $2.04-$2.09, significantly lower from the previous estimate of $2.29-$2.39.
Sales in 2019 will likely be up 1-2%, on a reported basis, lower from the previously-guided range of 5-6%. On core basis, sales growth will be flat to up 1%, which is also well below the prior guidance of 4-5%.

Two of its strategic acquisitions, Pelican Water Systems and Aquion, announced earlier this year, have strengthened the company’s Aquatics business, and the Residential and Commercial Treatment business. In addition, Pentair is focused on its capital-allocation strategy by creating long-term shareholder value. Also, the company has a solid balance-sheet position.

Pentair plc Price and Consensus

Zacks Rank and Stocks to Consider

Pentair currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the Industrial Products sector are DXP Enterprises, Inc. DXPE, Lawson Products, Inc. LAWS and Albany International Corp. AIN, each sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

DXP Enterprises has an expected earnings growth rate of 21.6% for 2019. The company’s shares have gained 16.3%, over the past year.

Lawson Products has an outstanding projected earnings growth rate of 102.5% for the current year. The stock has appreciated 26.8% in a year’s time.

Albany International has an estimated earnings growth rate of 44.7% for the ongoing year. The company’s shares have gained 12.6%, in the past year.

Zacks' Top 10 Stocks for 2019
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