Market Overview

Imperial Capital Is Bullish On Quanex Ahead Of Q2 Earnings

Imperial Capital Is Bullish On Quanex Ahead Of Q2 Earnings
Related NX
A Peek Into The Markets: U.S. Stock Futures Up Ahead Of Beige Book
7 Stocks To Watch For May 31, 2017

Quanex Building Products Corporation (NYSE: NX) is scheduled to report its 2Q16 results on May 31. Imperial Capital’s Scott Levine maintained an Outperform rating for the company, with a price target of $25. The analyst said that while the company likely witnessed healthy demand, its results could be impacted by currency headwinds.

Quanex’s quarterly results are likely to reflect healthy demand for windows and cabinet components, both in the US and in international markets. The demand is expected to have been driven by new housing construction as well as repair and remodeling activity, analyst Scott Levine said.

FX Impact

The deterioration of the British pound versus the US dollar is expected to have exerted pressure on the results, Levine mentioned. The UK accounts for more than 15 percent of the company’s revenue, following the acquisition of HL Plastics in 2015.

Related Link: Toll Brothers Gains 3% Following Q2 Beat, New Share Buyback Announcement

Although there are concerns surrounding the implications of the UK’s potential exit from the EU, this is unlikely to have a significant impact on Quanex’s 2Q results. Rather, the company is likely to have benefited from favorable weather in the US, boosting earnings of several building products companies, the analyst added.

Levine expects the company to report its 2Q EPS at $0.05. The EPS estimates for 3Q and 4Q have been reduced from $0.36 to $0.35 and from $0.46 to $0.44, respectively.

Latest Ratings for NX

Oct 2016KeyBancDowngradesOverweightSector Weight
Jun 2016KeyBancUpgradesSector WeightOverweight
Mar 2016WedbushUpgradesNeutralOutperform

View More Analyst Ratings for NX
View the Latest Analyst Ratings

Posted-In: imperial capital Scott LevineAnalyst Color Long Ideas Reiteration Analyst Ratings Trading Ideas Best of Benzinga


Related Articles (NX)

View Comments and Join the Discussion!