Despite Ugly Results Oppenheimer Maintains Outperform on Kronos (KRO), Slashes Price Target
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Price: $11.40 -1.21%
Rating Summary:
3 Buy, 3 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
Rating Summary:
3 Buy, 3 Hold, 2 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 16 | Down: 11 | New: 13
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Oppenheimer maintained an Outperform rating on Kronos (NYSE: KRO) but slashed its price target to $20.00 (from $36.00) after the company's pre-announced of sharp double-digit decline in 3Q revenue.
"KRO had expected a sequential increase in volume after 2Q's severe 16% yoy drop, but customers continued to de-stock. This led to $28MM of negative fixed-cost absorption, which, with higher ore costs that are starting to alleviate, but not yet offset by pricing, led to the ugly results," said analyst Edward Yang.
"Although we clearly have egg on our face, like management, for underestimating the magnitude of de-stocking, KRO's TiO2 volumes in three of the last four quarters are down 16-19% yoy, which if not the bottom, should be very close," he said.
For an analyst ratings summary and ratings history on Kronos click here. For more ratings news on Kronos click here.
Shares of Kronos closed at $14.77 yesterday.
"KRO had expected a sequential increase in volume after 2Q's severe 16% yoy drop, but customers continued to de-stock. This led to $28MM of negative fixed-cost absorption, which, with higher ore costs that are starting to alleviate, but not yet offset by pricing, led to the ugly results," said analyst Edward Yang.
"Although we clearly have egg on our face, like management, for underestimating the magnitude of de-stocking, KRO's TiO2 volumes in three of the last four quarters are down 16-19% yoy, which if not the bottom, should be very close," he said.
For an analyst ratings summary and ratings history on Kronos click here. For more ratings news on Kronos click here.
Shares of Kronos closed at $14.77 yesterday.
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