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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Equity Bottom-Up

<ul><li>Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.</li><li>Positive surprises on the gross margin line accounted for the beat. Sales were roughly in line with expectations at $711.7 million versus our $713 million estimate.</li><li>Our pre-report concerns were answered with strong performance.</li></ul>

Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.Positive surprises on the gross margin line accounted for the beat. Sales were roughly in line with expectations at $711.7 million versus our $713 million estimate.Our pre-report concerns were answered with strong performance.

HNI Corporation - 3Q23 Margins Beat Expectations

<ul><li>HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET. </li><li>We expect 3Q23 non-GAAP EPS of $0.64 on consolidated sales of $713 million. Consensus is $0.63 EPS on consolidated sales of $713 million.</li><li>In 3Q22, HNI delivered $0.71 in non-GAAP EPS on consolidated sales of $598.8 million.</li></ul>

HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET. We expect 3Q23 non-GAAP EPS of $0.64 on consolidated sales of $713 million. Consensus is $0.63 EPS on consolidated sales of $713 million.In 3Q22, HNI delivered $0.71 in non-GAAP EPS on consolidated sales of $598.8 million.

HNI Corporation - 3Q Preview: Looking for Steady Demand in WF Segment

Thematic (Sector/Industry)

<ul>
<li>The office furniture group fell 6% last week, breaking a streak of outperformance, as indicators pointed to weakness.</li>
<li>The office furniture group is up ~21% in 2023 and 32% over the past 12 months.</li>
<li>The Architectural Billings Index (ABI), a diffusion index and key leading indicator of non-residential construction activity (9-12 months), fell to 44.8 in September from 48.1 in August (AIA). </li>
</ul>


The office furniture group fell 6% last week, breaking a streak of outperformance, as indicators pointed to weakness.
The office furniture group is up ~21% in 2023 and 32% over the past 12 months.
The Architectural Billings Index (ABI), a diffusion index and key leading indicator of non-residential construction activity (9-12 months), fell to 44.8 in September from 48.1 in August (AIA). 


Furniture/Furnishings Weekly - Weak Signals for Office Furniture

<div><div><div><div><ul style="list-style-type: disc;"><li><p>The Fall Furniture Market in High Point, N.C. brought the industry together last week to do business, celebrate successes, and commiserate.</p></li><li><p>We spent the day Saturday, the official opening day, while buyers and vendors had been there since the prior Tuesday.</p></li><li><p>The sky over High Point was gray and wet. So was the mood.</p></li></ul></div></div></div></div>

The Fall Furniture Market in High Point, N.C. brought the industry together last week to do business, celebrate successes, and commiserate.We spent the day Saturday, the official opening day, while buyers and vendors had been there since the prior Tuesday.The sky over High Point was gray and wet. So was the mood.

Furniture/Furnishings Weekly - Gray Skies over High Point; Cloudy Conditions for Industry

<div><div><div><ul style="list-style-type: disc;"><li><p>MillerKnoll earnings sparked a second week of outperformance for the commercial/contract furniture stocks, which rose ~8% in a week when broader indices were roughly flat.</p></li><li>MLKN reported adjusted EPS of $0.37 in 1QFY24, above consensus of $0.21 consensus, and upped guidance.</li><li>Shares jumped 27% on Wednesday. All three major US firms in the sector advanced last week.</li></ul></div></div></div>

MillerKnoll earnings sparked a second week of outperformance for the commercial/contract furniture stocks, which rose ~8% in a week when broader indices were roughly flat.MLKN reported adjusted EPS of $0.37 in 1QFY24, above consensus of $0.21 consensus, and upped guidance.Shares jumped 27% on Wednesday. All three major US firms in the sector advanced last week.

Furniture/Furnishings Weekly  - MLKN Results Boost Sector; Consumer Confidence Dips

United States

HNI Corporation manufactures and markets office furniture as well as hearth products. The Company's products are sold primarily through dealers, wholesalers, and retail superstores. HNI has operations in the United States and Canada.

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HNI Corp (HNI US)

HNI Corporation - 3Q23 Margins Beat Expectations

Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.

Water Tower Research

HNI Corporation - 3Q Preview: Looking for Steady Demand in WF Segment

HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET.

Water Tower Research

Furniture/Furnishings Weekly - Weak Signals for Office Furniture

The office furniture group fell 6% last week, breaking a streak of outperformance, as indicators pointed to weakness. The office furniture group is...

Water Tower Research

Furniture/Furnishings Weekly - Gray Skies over High Point; Cloudy Conditions for Industry

The Fall Furniture Market in High Point, N.C. brought the industry together last week to do business, celebrate successes, and commiserate.

Water Tower Research

Furniture/Furnishings Weekly - MLKN Results Boost Sector; Consumer Confidence Dips

MillerKnoll earnings sparked a second week of outperformance for the commercial/contract furniture stocks, which rose ~8% in a week when broader...

Water Tower Research

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