Graco, Hexcel and Snap-on shares fall after third-quarter results

what happened

According to StockStory, three industrial companies saw their shares drop on October 22 after publishing quarterly results. Graco (GGG) fell 13.5% even though net sales rose 8% to $586.4 million, because operating earnings declined 10% and adjusted EPS of $0.81 came in below the $0.84 analysts expected. Its fourth-quarter revenue guidance of $625 million at the midpoint also trailed the $648.5 million consensus.

Hexcel (HXL) dropped about 12% after posting net sales of $496.4 million, short of the $502.8 million Wall Street had forecast. The company kept its full-year revenue guidance of $2.08 billion at the midpoint and raised its share repurchase authorization to $750 million. Snap-on (SNA) fell 5.7% at the open as net sales slipped 0.6% to $1.18 billion, organic sales dropped 2.8% and diluted EPS came in at $4.64 versus $5.02 a year earlier.

why it matters

The combination of softer demand, compressed margins and cautious outlooks suggests that parts of the industrial sector are struggling to turn sales growth into profit. For markets, this is a signal to revisit expectations for capital spending and manufacturing demand, even as some companies keep buying back their shares.

market impact

US industrial stocks: weak outlooks and margin pressure weigh on Graco, Hexcel and Snap-on shares

tags

instruments