Pentair plc PNR reported first-quarter 2024 adjusted earnings per share (EPS) of 94 cents, beating the Zacks Consensus Estimate of 90 cents. The bottom line was above the company’s guidance of 88-91 cents per share for the quarter and improved 3% from the year-ago quarter.

Including one-time items, EPS was 80 cents compared with the year-ago quarter’s 78 cents.

Net sales dipped 1% year over year to $1.02 billion in the quarter under review. However, the top line outpaced the Zacks Consensus Estimate of $1 billion. Excluding the impacts of acquisitions, divestitures and currency translation, core sales declined 1% in the quarter.

Pentair plc Price, Consensus and EPS Surprise Pentair plc Price, Consensus and EPS Surprise

Pentair plc price-consensus-eps-surprise-chart | Pentair plc Quote

The cost of sales declined 3% year over year to $627 million. The gross profit in the reported quarter amounted to $390 million, up 2% from the year-ago quarter. The gross margin was 38.4% compared with the year-ago quarter’s 37.1%.

SG&A expenses totaled $185 million, which rose 7% from the year-ago quarter’s $173 million. Research and development expenses were down 3% year over year to $24 million.

The operating income in the quarter was $181 million, down 1.5% year over year. The adjusted segmental operating income increased 2.8% year over year to $217 million. The adjusted segment margin was 21.4% in the reported quarter compared with the year-ago quarter’s 20.5%.

Segmental Performances

Net sales in the Flow segment totaled $384 million, down 2% from the year-ago quarter. Core sales dipped 2% in the quarter under review. Our estimate for the segment’s net sales was $388.5 million for the quarter.

Operating earnings for the segment increased 19% year over year to $77 million. Our estimate for the segment’s operating profit was $65 million.

Net sales in the Water Solutions segment rose 0.4% year over year to $273 million. Core sales were up 1% year over year in the quarter. Our estimate for the segment’s net sales was $266 million for the quarter. The segment’s earnings were $56 million, a 6% increase compared with $52 million reported in the year-ago quarter. The figure was higher than our estimate of $53 million.

Net sales in the Pool segment totaled $360 million in the quarter, down 1% from the year-ago quarter. Core sales were also down 1% from the year-ago quarter. Our estimate for the segment’s net sales was $353 million.

Operating earnings for the Pool segment declined 5% year over year to $111 million. Our estimate for the segment’s operating income was $116 million.



Cash Flow & Balance Sheet Updates

Pentair had cash and cash equivalents of around $107 million at the end of the first quarter of 2024 compared with $170 million in 2023 end. Net cash used in operating activities was $107 million in the first quarter of 2024 flat compared with the year-ago quarter . The company had a long-term debt of $2.08 billion as of Mar 31, 2024, up from $1.99 billion as of Dec 31, 2023.

On Feb 19, 2024, Pentair announced it would pay a regular quarterly cash dividend of 23 cents per share on May 3, 2024, to shareholders of record at the close of business on Apr 19, 2024.

Guidance for 2024

Pentair expects adjusted EPS of $4.15-$4.25 for 2024. The guidance indicates year-over-year growth range of 11-13% from the adjusted EPS of $3.75 in 2023.

Sales growth for the year is expected to be between 2% and 3% on a reported basis. Pentair’s net sales were $4.1 billion in 2023.

For the second quarter of 2024, the company expects adjusted EPS of $1.15-$1.17. Pentair anticipates the current quarter’s sales to be up 1-2% from the year-ago quarter’s reported figure.

Price Performance

The Pentair stock has gained 46.7% over the past year compared with the industry’s 10% growth. Zacks Investment Research

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Zacks Rank & Stocks to Consider

Pentair currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the Industrial Products sector are Applied Industrial Technologies AIT, Chart Industries, Inc. GTLS and Cadre Holdings, Inc. CDRE. AIT currently sports a Zacks Rank #1 (Strong Buy), and GTLS and CDRE carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Applied Industrial has an average trailing four-quarter earnings surprise of 13.9%. The Zacks Consensus Estimate for AIT’s 2024 earnings is pinned at $9.49 per share, which indicates year-over-year growth of 7.8%. Estimates have moved 1% north in the past 60 days. The company’s shares have gained 34.2% in the past year.

The Zacks Consensus Estimate for Chart Industries’ 2024 earnings is pegged at $11.98 per share. The consensus estimate for 2024 earnings has moved 6% north in the past 60 days and suggests year-over-year growth of 93.6%. The company has a trailing four-quarter average earnings surprise of 75.9%. GTLS shares have gained 12.2% in the past year.

The Zacks Consensus Estimate for Cadre Holdings’ 2024 earnings is pegged at $1.18 per share. The consensus estimate for 2024 earnings has moved 7% north in the past 60 days and suggests year-over-year growth of 16.7%. The company has a trailing four-quarter average earnings surprise of 33%. CDRE shares have gained 51.2% in the past year.

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