sIcahn Enterprises (NASDAQ:IEP) Reports Sales Below Analyst Estimates In Q3 Earnings, Stock Drops
In This Article:
Holding company and industrial conglomerate Icahn (NYSE:IEP) missed Wall Street’s revenue expectations in Q3 CY2024, with sales falling 25.7% year on year to $2.22 billion. Its GAAP profit of $0.05 per share was also 76.2% below analysts’ consensus estimates.
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Icahn Enterprises (IEP) Q3 CY2024 Highlights:
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Revenue: $2.22 billion vs analyst estimates of $2.32 billion (4.1% miss)
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EPS: $0.05 vs analyst estimates of $0.21 (-$0.16 miss)
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Gross Margin (GAAP): -0.1%, down from 14.9% in the same quarter last year
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Operating Margin: -9.2%, down from 7.9% in the same quarter last year
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EBITDA Margin: 8.2%, down from 11.8% in the same quarter last year
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Market Capitalization: $6.13 billion
Company Overview
Founded in 1987, Icahn Enterprises (NASDAQ: IEP) is a diversified holding company primarily engaged in investment and asset management across various sectors.
General Industrial Machinery
Automation that increases efficiency and connected equipment that collects analyzable data have been trending, creating new demand for general industrial machinery companies. Those who innovate and create digitized solutions can spur sales and speed up replacement cycles, but all general industrial machinery companies are still at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.
Sales Growth
A company’s long-term performance can indicate its business quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Icahn Enterprises grew its sales at a weak 1.4% compounded annual growth rate. This shows it failed to expand in any major way, a rough starting point for our analysis.
Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Icahn Enterprises’s history shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 15.5% annually.
This quarter, Icahn Enterprises missed Wall Street’s estimates and reported a rather uninspiring 25.7% year-on-year revenue decline, generating $2.22 billion of revenue.
Looking ahead, sell-side analysts expect revenue to decline 6.2% over the next 12 months. While this projection is better than its two-year trend it's tough to feel optimistic about a company facing demand difficulties.
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