StockBeat – Pentair Cuts Guidance as Cold Snap Freezes Growth; Shares Fall
Pentair plunged on Tuesday following water solutions company cut its full-year guidance following weaker preliminary first-quarter results due to adverse climate conditions.
For full-year 2019, Pentair (NYSE:PNR) stated that it expects adjusted earnings per share in the plethora $2.30 to $2.35, below prior guidance of $2.50 to $2.60. Full-year sales, meanwhile, will be required to improve about 1% to 2% using a reported basis, down from previous sales guidance with an increase of about 5% to 6%.
Its shares fell over 14%.
Pentair reported preliminary first-quarter adjusted earnings of $0.43 per share, missing its prior forecast for earnings inside of a selection of $0.52 to $0.55 per share. Revenue for the quarter slumped 6%, well below the previous estimate of flat to up 1%.
“Our first quarter was significantly influenced by the adverse winter weather in the higher margin aquatics and ag-related businesses,” Pentair CEO John L. Stauch said.
The company also highlighted moderating rise in a few of its end markets and higher-than-expected inventory levels in certain of its key distribution channels as headwinds in the quarter weighed on growth.
“Due to seasonality in PNR’s major end markets, its unlikely the business can fully recoup from Q1 headwinds in 2019, but we expect money to normalcy increase in 2020,” said CFRA, persistent research provider.
“We forecast 2019 sales up 1%-2%, down from a previous estimate for 5% growth.”
Pentair will report full first-quarter results on April 17.