Kronos Worldwide, Inc. KRO reported second-quarter 2024 earnings of 17 cents per share against a loss of 7 cents incurred in the year-ago quarter. However, the figure missed the Zacks Consensus Estimate of 21 cents.

Net sales increased around 12.9% year over year to $500.5 million due to higher sales volumes as a result of stronger demand for titanium dioxide (TiO2) in all of KRO’s major markets, which was somewhat offset by lower average TiO2 selling prices. The top line, however, missed the Zacks Consensus Estimate of $504.2 million.

Kronos Worldwide Inc Price, Consensus and EPS Surprise

Kronos Worldwide Inc price-consensus-eps-surprise-chart | Kronos Worldwide Inc Quote

Volumes and Pricing

TiO2 production volumes (thousand metric tons) were up 53.9% year over year to 137 in the second quarter. TiO2 sales volumes (thousand metric tons) rose 28.8% to 134 in the quarter. 

TiO2 segment profit was $41.1 million in the reported quarter against a segment loss of $2.3 million a year ago. The upside is driven primarily by improved operating income as a result of increased sales and production volumes and lower production costs, offset by lower average TiO2 selling prices.

Financials

Kronos ended the quarter with cash and cash equivalents of $133.8 million, down roughly 22% year over year. Long-term debt declined 6% to $423.7 million.

Outlook

Kronos predicts that demand will continue to improve in 2024. Sales volumes for the year are expected to be higher than in 2023. The company has boosted production rates in response to present and predicted near-term enhanced demand. It expects production rates for the balance of 2024 to remain higher than a year ago. The company has undertaken TiO2 selling price hikes, which need to be sustained in order to attain margins in-line with historical levels.

Price Performance

Shares of Kronos have gained 11.7% in the past year against a 10% decline of the industry.

Image Source: Zacks Investment Research

Zacks Rank & Other Key Picks

KRO currently carries a Zacks Rank #1 (Strong Buy).

Other top-ranked stocks worth a look in the basic materials space include Barrick Gold Corporation GOLD, Franco-Nevada Corporation FNV and Avino Silver & Gold Mines Ltd. ASM.

Barrick is slated to report second-quarter results on Aug 12, before market open. The Zacks Consensus Estimate for its second-quarter earnings is pegged at 26 cents. GOLD beat the consensus estimate in each of the last four quarters, with the average earnings surprise being 18.3%. GOLD currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Franco-Nevada, carrying a Zacks Rank #1, is slated to report second-quarter results on Aug 13. The Zacks Consensus Estimate for FNV's second-quarter earnings is pegged at 78 cents. FNV beat the consensus in the last four quarters, with the average earnings surprise being 10.5%.

Avino Silver, carrying a Zacks Rank #1, is slated to report second-quarter results on Aug 13. The Zacks Consensus Estimate for ASM's second-quarter earnings is pegged at 2 cents. The stock has surged nearly 22.8% in the past year.