Chart Industries Downgraded To Strong Sell - Analyst Blog

Zacks Investment Research downgraded Chart Industries Inc. GTLS to a Zacks Rank #5 (Strong Sell) on Jun 10, 2014. Going by the Zacks model, companies holding a Zacks Rank #5 have strong chances of performing worse than the broader market.

Why the Downgrade?

Chart Industries reported disappointing results for first-quarter 2014. The company's earnings were 41 cents per share, down from 54 cents per share earned in the year-ago quarter. Also, the bottom-line result lagged the Zacks Consensus Estimate of 62 cents per share.  

Revenues decreased 3% year over year to $266.2 million due to weak performance in the BioMedical segment. Orders declined 8.6% sequentially while backlog inched down 1% at the quarter-end. Gross profit slipped 2.4% year over year with gross margin standing at 29.1%.

For 2014, Chart Industries revised its sales guidance downward to a range of $1.25−$1.3 billion from the prior expectation of $1.3−$1.35 billion. Earnings are anticipated to lie within $3.00−$3.40 per share, down from the $3.10−$3.50 range projected earlier.

Lower-than-expected results and lowered sales and earnings per share guidance for 2014 triggered downward revisions in the earnings estimates for Chart Industries. Over the last 60 days, the Zacks Consensus Estimate has decreased 5.2% to $3.09 for 2014 and 5.5% to $3.99 for 2015. Also, the company has an Earnings ESP of -1.33% for second-quarter 2014 and -4.8% for full-year 2014.

Other Stocks to Consider

Chart Industries has a market capitalization of $2.4 billion. Some better-ranked stocks in the same industry include Gorman-Rupp Co. GRC, Blount International Inc. BLT and Nordson Corporation NDSN. While Gorman-Rupp sports a Zacks Rank #1 (Strong Buy), both Blount International and Nordson hold a Zacks Rank #2 (Buy).
 

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