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Bear of the Day: Actuant (ATU)

Zacks

Actuant (ATU) recently lowered guidance and that might cause Wall Street to lose faith in management. Let’s look at why that may be the case in the Bear of the Day.

Description

Actuant, headquartered in Milwaukee, Wisconsin, is a diversified industrial company with operations in 15 countries. Actuant offers products under such established brand names as Enerpac, Gardner Bender, Milwaukee Cylinder, Nielsen Sessions, Power-Packer, and Power Gear.


Guidance

On June 8, the company lowered guidance for 3Q17 to a range of $0.30-$-0.33. This was following earnings that were released on March 22, when the company offered guidance of $0.38 – $0.43 for the quarter.

The consensus estimate at the time of the most recent earnings report was $0.43, so the best case scenario was that Wall Street was going to see a meet in the coming quarter. The updated guidance suggests things were significantly worse than expected.

Estimates

When a accompany lowers guidance, analysts tend to move their estimates lower. That is the case for ATU and that has pushed the stock to a Zacks Rank #5 (Sell).

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