Schnitzer Steel Industries Third Quarter Earnings Sneak Peek

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Schnitzer Steel Industries, Inc. (NASDAQ:SCHN) will unveil its latest earnings on Thursday, June 28, 2012. Schnitzer Steel Industries is currently a recycler of ferrous and nonferrous scrap metal and used and salvaged vehicles. It is also a manufacturer of finished steel products.

Schnitzer Steel Industries, Inc. Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 24 cents per share, a decline of 79.5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $1.01. Between one and three months ago, the average estimate moved down. It also has dropped from 43 cents during the last month. Analysts are projecting profit to rise by 72.2% compared to last year’s $1.18.

Past Earnings Performance: The company is hoping to avoid falling below analyst estimates after topping expectations in the previous quarter. Last quarter, it beat expectations with profit of 35 cents against a mean estimate of net income of 33 cents.

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A Look Back: In the second quarter, profit fell 68.8% to $9.6 million (35 cents a share) from $30.8 million ($1.10 a share) the year earlier, but exceeded analyst expectations. Revenue rose 22.8% to $886.6 million from $721.8 million.

Stock Price Performance: Between March 28, 2012 and June 22, 2012, the stock price fell $15.71 (-39.1%), from $40.20 to $24.49. The stock price saw one of its best stretches over the last year between January 13, 2012 and January 25, 2012, when shares rose for eight straight days, increasing 5.4% (+$2.35) over that span. It saw one of its worst periods between November 15, 2011 and November 25, 2011 when shares fell for eight straight days, dropping 14.4% (-$6.89) over that span.

Wall St. Revenue Expectations: Analysts predict a decline of 10.7% in revenue from the year-earlier quarter to $876 million.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 37.9% over the last four quarters.

The company is trying to use this earnings announcement to rebound from income declines in the past two quarters. Net income dropped 60.6% in the first quarter and then again in the second quarter.

Analyst Ratings: With three analysts rating the stock a sell, one rating it as a buy and four rating it as a hold, there are indications of a bearish outlook.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 3.44 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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