Stanley Black & Decker Misses Third-Quarter Sales, Cuts Full-Year Outlook
Toolmaker hit by supply chain disruptions, inflation
Stanley Black & Decker Inc. on Tuesday missed Wall Street's sales estimates for the third quarter and cut its full-year outlook, as the toolmaker continues to grapple with supply chain disruptions and inflation.
Sales fall short
The New Britain, Connecticut-based company reported net sales of $4.31 billion for the quarter ended Sept. 30, up 11.9% year-over-year but below analysts' average estimate of $4.36 billion, according to Refinitiv data.
Earnings beat
Despite the sales miss, Stanley Black & Decker beat earnings expectations, with adjusted earnings per share of $2.94 surpassing the consensus estimate of $2.84.
Outlook cut
The company now expects full-year sales growth of 8% to 10%, down from its previous forecast of 9% to 11%. It also lowered its adjusted earnings per share guidance to a range of $11.50 to $11.70 from $11.75 to $12.05.
Supply chain issues
Stanley Black & Decker CEO Donald Allan Jr. said the company continues to face supply chain disruptions, particularly in Asia, which have led to higher costs and delivery delays.
Inflationary pressures
The company is also facing inflationary pressures, with costs for raw materials, transportation, and labor increasing. Allan said the company is working to offset these costs through price increases and cost-cutting measures.
Demand remains strong
Despite the challenges, Allan said demand for the company's products remains strong, particularly in the automotive and construction sectors.
Outlook cautious
However, the company is cautious about the outlook for the rest of the year, given the ongoing supply chain and inflationary challenges.
Financial results
- Net sales: $4.31 billion, up 11.9% year-over-year
- Adjusted earnings per share: $2.94, up 12.4% year-over-year
- Full-year sales growth outlook: 8% to 10%, down from previous forecast of 9% to 11%
- Full-year adjusted earnings per share guidance: $11.50 to $11.70, down from previous guidance of $11.75 to $12.05
Challenges
- Supply chain disruptions
- Inflationary pressures
Opportunities
- Strong demand in automotive and construction sectors
Outlook
Stanley Black & Decker is cautious about the outlook for the rest of the year, given the ongoing supply chain and inflationary challenges.
