Sono-Tek Q2 profit misses estimates as higher costs outweigh margin gains
Overview
US ultrasonic coating systems maker's Q2 revenue rose 1% yr/yr, gross margin expanded to 53%
EPS for Q2 declined to $0.02 from $0.03 in prior-year period
Company reiterates flat to modest revenue growth guidance for FY 27, citing timing of large orders
Outlook
Sono-Tek reiterates expectation of flat to modest revenue growth for FY 27
Company says recent large orders significantly increase revenue visibility for FY 28
Sono-Tek sees quarter-to-quarter revenue variability due to timing of large orders
Result Drivers
MEDICAL SALES SURGE - Co said medical market sales rose 209% in Q2, led by shipments of balloon coating and specialty stent-coating systems
PRODUCT AND GEOGRAPHIC MIX - Co attributed expanded Q2 gross margin to an unusually favorable product and geographic mix
HIGHER OPERATING EXPENSES - Co said increased operating expenses partially offset gross profit gains in Q2
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q2 Revenue | Miss | $5.23 mln | $5.54 mln (2 Analysts) |
Q2 EPS | Miss | $0.02 | $0.04 (2 Analysts) |
Q2 Net Income | $366,000 |
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 1 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the industrial machinery & equipment peer group is "buy"
Wall Street's median 12-month price target for Sono-Tek Corp is $8.50, about 19.4% above its October 13 closing price of $7.12
The stock recently traded at 58 times the next 12-month earnings vs. a P/E of 55 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)