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Category: Twin Disc
Date: 2 May 2021 Stock Price of Twin Disc (TWIN): $10.55 Market Capital of Twin Disc (TWIN): $143.9 million We take a look at the 3rd quarter earnings report of their 2021 fiscal year of Twin Disc (TWIN) a firm that designs, manufactures and sells marine and heavy-duty off-highway power transmission equipment.
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- John H. Batten, Chief Executive Officer - I am encouraged by the progress we are making navigating one of the most challenging cycles in Twin Disc’s 103-year history, and we experienced a strong improvement in profitability during the quarter."
More About Twin Disc
Twin Disc, Inc. designs, manufactures and sells marine and heavy-duty off-highway power transmission equipment. Products offered include marine transmissions, azimuth drives, surface drives, propellers, and boat management systems, as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches, and control systems. The Company sells its products to customers primarily in the pleasure craft, commercial and military marine markets, as well as in the energy and natural resources, government, and industrial markets. The Company’s worldwide sales to both domestic and foreign customers are transacted through a direct sales force and a distributor network.
Overview of Twin Disc (TWIN) 3rd quarter 2021 earnings report
First Quarter 2021 Highlights
- Challenging market conditions continue due to the global COVID-19 crisis
- Improving profitability drives strongest earnings in eight quarters
- Generated $2.2 million of operating cash flow for the three months ended March 26, 2021
- Gross profit percent for the fiscal 2021 third quarter was 24.2%, compared to 24.1% in the fiscal 2020 third quarter
- Twin Disc recorded restructuring charges of $0.3 million in the fiscal 2021 third quarter
Chubb (CB) management commentary on their 1st quarter 2021 earnings report
RACINE, Wis., April 30, 2021 (GLOBE NEWSWIRE) -- Twin Disc, Inc. (NASDAQ: TWIN), today reported financial results for the fiscal 2021 third quarter ended March 26, 2021.
Sales for the fiscal 2021 third quarter decreased to $57.6 million, from $68.6 million for the same period last year. The 16.0% decrease in 2021 third quarter sales was primarily due to continued softness in the Company’s oil and gas markets along with weaker demand for industrial products compared to the same period the prior fiscal year. Year-to-date, sales were $152.4 million, compared to $187.5 million for the fiscal 2020 nine months. Foreign currency exchange had a $3.9 million favorable impact on fiscal 2021 third quarter sales and a $7.5 million favorable impact on fiscal 2021 year-to-date sales.
John H. Batten, Chief Executive Officer, commented: “I am encouraged by the progress we are making navigating one of the most challenging cycles in Twin Disc’s 103-year history, and we experienced a strong improvement in profitability during the quarter. Throughout the COVID-19 pandemic we have focused on realigning our cost structure, improving our balance sheet, investing in new products and technologies, and opening our Lufkin, TX facility, while supporting our customers and associates. As trends within our markets improve, we are well positioned to significantly increase sales and profitability, and I am excited by the long-term opportunities we have across our business.”
Sales for the fiscal 2021 third quarter decreased to $57.6 million, from $68.6 million for the same period last year. The 16.0% decrease in 2021 third quarter sales was primarily due to continued softness in the Company’s oil and gas markets along with weaker demand for industrial products compared to the same period the prior fiscal year. Year-to-date, sales were $152.4 million, compared to $187.5 million for the fiscal 2020 nine months. Foreign currency exchange had a $3.9 million favorable impact on fiscal 2021 third quarter sales and a $7.5 million favorable impact on fiscal 2021 year-to-date sales.
John H. Batten, Chief Executive Officer, commented: “I am encouraged by the progress we are making navigating one of the most challenging cycles in Twin Disc’s 103-year history, and we experienced a strong improvement in profitability during the quarter. Throughout the COVID-19 pandemic we have focused on realigning our cost structure, improving our balance sheet, investing in new products and technologies, and opening our Lufkin, TX facility, while supporting our customers and associates. As trends within our markets improve, we are well positioned to significantly increase sales and profitability, and I am excited by the long-term opportunities we have across our business.”
Jeffrey S. Knutson, Vice President – Finance, Chief Financial Officer, Treasurer and Secretary stated, “We continue to focus on controlling expenses and generating positive operating cash flow, which have significantly strengthened our balance sheet. In fact, including the $8.2 million for our PPP loan, which we expect to be fully forgiven in the coming quarters, our net debt balance was $29.6 million, the lowest level since the quarter following our acquisition of Veth Propulsion in 2018. We continue to manage spending, strengthen our balance sheet, and invest in our business. We currently expect to invest $5 million to $7 million in capital expenditures during fiscal 2021.”
Twin Disc (TWIN) stock price chart over the last 5 years
The image below shows the stock price history of Twin Disc over the last 5 years. And it's been a very average time for Twin Disc stockholders. Over the last 5 years the stock of Twin Disc has increased by 10.8%. Not exactly providing the returns that will make investors warm and fuzzy
The stock of Twin Disc is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Twin Disc stock is positive at this point in time.
The stock of Twin Disc is trading at closer to its 52 week high than it is to its 52 week low which is a clear indication that the short term sentiment and momentum of Twin Disc stock is positive at this point in time.
Twin Disc (TWIN) latest stock valuation
So what is Twin Disc stock worth based on the release of their latest earnings report? Based on Twin Disc latest earnings report our valuation models provide a target price (full value) price for Twin Disc stock at $26.40 a stock. Therefore we believe the stock of Twin Disc is undervalued at its current price of $10.55
We usually recommend that long term fundamental or value investors look to enter the stock at 10% below our target price (full value price) which in this case is $26.40, so a good entry point into Twin Disc stock would be at $23.70 or below.
We expect the stock of Twin Disc to kick up in coming weeks and months as it is far below our target price (full value price). Since the stock of Twin Disc is trading at far below our suggested entry price we rate the stock of Twin Disch a buy
We usually recommend that long term fundamental or value investors look to enter the stock at 10% below our target price (full value price) which in this case is $26.40, so a good entry point into Twin Disc stock would be at $23.70 or below.
We expect the stock of Twin Disc to kick up in coming weeks and months as it is far below our target price (full value price). Since the stock of Twin Disc is trading at far below our suggested entry price we rate the stock of Twin Disch a buy
Next earnings release date for Twin Disc
It is expected that Twin Disc will release their 4th quarter 2021 earnings report will be released in late July 2021