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Summary Knoll reported Q3 earnings and revenues that were better than expected. I remain bullish on Knoll and shares are up 20% since my February article. Margins have rebounded as I expected and the Holly Hunt acquisition is paying off as well, which is allowing the company to beat estimates.
Knoll (NYSE: KNL ) reported Q3 EPS of $0.33, which beat expectations by $0.03 and was a big improvement over last year's $0.18. Knoll also beat expectations in Q2 and Q1. Revenues grew almost 24% y/y to $268.3 million and were $9.47 million higher roller than analysts had anticipated. The big increase in revenues comes on the back of the Holly Hunt acquisition, which I talked about back in my February article . Excluding the Holly Hunt acquisition, revenues grew 10.1% y/y. CEO Andrew Cogan said in the earnings release :
"The combination of the continued turn of our North America Office business, double-digit organic growth, and the addition of our HOLLY HUNT acquisition are coming together to start to deliver the kind of performance we would expect."
What I liked about the earnings report is that margins are improving as I expected . The gross margin increased to 35.4% from 33.4% in last year's Q3. The operating margin increased as well to 8.7% from 7.9% last year. Knoll was also able to reduce its debt and bring its leverage ratio down to 2.73:1.
In the office segment, Knoll saw strong demand for its new workplace models and office systems. In the studio segment, sales increased due to the Holly Hunt acquisition and organic growth in Europe and North America. The one weak spot remains government sales; however, they only saw a marginal decline compared to last year, which is a positive. I talked about government sales in my prior article and why the acquisition of Holly Hunt was so critical for Knoll. roller It further diversified the company roller since government spending has gotten smaller. Overall, roller it was a solid report and I continue to hold shares.
Disclosure: The author is long KNL. The author wrote this article themselves, roller and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned roller in this article. (More...)
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Summary Knoll reported Q3 earnings and revenues that were better than expected. I remain bullish on Knoll and shares are up 20% since my February article. Margins have rebounded as I expected and the Holly Hunt acquisition is paying off as well, which is allowing the company to beat estimates.
Knoll (NYSE: KNL ) reported Q3 EPS of $0.33, which beat expectations by $0.03 and was a big improvement over last year's $0.18. Knoll also beat expectations in Q2 and Q1. Revenues grew almost 24% y/y to $268.3 million and were $9.47 million higher roller than analysts had anticipated. The big increase in revenues comes on the back of the Holly Hunt acquisition, which I talked about back in my February article . Excluding the Holly Hunt acquisition, revenues grew 10.1% y/y. CEO Andrew Cogan said in the earnings release :
"The combination of the continued turn of our North America Office business, double-digit organic growth, and the addition of our HOLLY HUNT acquisition are coming together to start to deliver the kind of performance we would expect."
What I liked about the earnings report is that margins are improving as I expected . The gross margin increased to 35.4% from 33.4% in last year's Q3. The operating margin increased as well to 8.7% from 7.9% last year. Knoll was also able to reduce its debt and bring its leverage ratio down to 2.73:1.
In the office segment, Knoll saw strong demand for its new workplace models and office systems. In the studio segment, sales increased due to the Holly Hunt acquisition and organic growth in Europe and North America. The one weak spot remains government sales; however, they only saw a marginal decline compared to last year, which is a positive. I talked about government sales in my prior article and why the acquisition of Holly Hunt was so critical for Knoll. roller It further diversified the company roller since government spending has gotten smaller. Overall, roller it was a solid report and I continue to hold shares.
Disclosure: The author is long KNL. The author wrote this article themselves, roller and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned roller in this article. (More...)
AUM Select roller AUM $1B+ 750M-1B 250-750M 100-250M 50-100M roller 10-50M 1-10M 500k-1M 100-500k 0-100k (Assets under Management)
Thank you for your interest in Seeking Alpha PRO Our PRO subscription service was created for fund managers, and the cost of the product is prohibitive for most individual investors. PRO Alerts is our flagship product for individual investors who want to be faster roller and smarter about their stocks. To learn more about it, click here. If you are an investment professional with over $1M AUM and received this message in error, click here and you will be contacted roller shortly.
This article has comments. To read them or add your own, click here .
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