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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>We are revising our EPS and revenue estimates following Steelcase’s 2QFY25 earnings release and investor call. See our update note for a summary of the quarter (1).</li><li>Our new 3QFY25 revenue estimate of $799 million and adjusted EPS estimate of $0.22 are both near the midpoints of management’s current guidance and are largely in line with our prior estimates (our new revenue estimate is slightly lower than our prior 3QFY25 estimate and we are lowering our adjusted EPS estimate by $0.02 accordingly).</li><li>Our FY25 adjusted EPS of $0.97 is unchanged and is at the higher end of management’s range of $0.85-1.00. </li></ul>

We are revising our EPS and revenue estimates following Steelcase’s 2QFY25 earnings release and investor call. See our update note for a summary of the quarter (1).Our new 3QFY25 revenue estimate of $799 million and adjusted EPS estimate of $0.22 are both near the midpoints of management’s current guidance and are largely in line with our prior estimates (our new revenue estimate is slightly lower than our prior 3QFY25 estimate and we are lowering our adjusted EPS estimate by $0.02 accordingly).Our FY25 adjusted EPS of $0.97 is unchanged and is at the higher end of management’s range of $0.85-1.00. 

Steelcase, Inc. - Updating EPS and Revenue Estimates on Margin Strength

<ul><li>SCS posted 2QFY25 adjusted EPS of $0.39, $0.03 ahead of WTR’s estimate of $0.36 and $0.02 better than consensus of $0.37. GAAP EPS of $0.53 included $0.18 from a gain on the sale of land, net.</li><li>Net revenue was roughly flat at $855.8 million versus the prior year, with the improvement coming largely on the heels of better margins and cost controls.</li><li>Revenue was up in the Americas but demand remains weak in International. </li></ul>

SCS posted 2QFY25 adjusted EPS of $0.39, $0.03 ahead of WTR’s estimate of $0.36 and $0.02 better than consensus of $0.37. GAAP EPS of $0.53 included $0.18 from a gain on the sale of land, net.Net revenue was roughly flat at $855.8 million versus the prior year, with the improvement coming largely on the heels of better margins and cost controls.Revenue was up in the Americas but demand remains weak in International. 

Steelcase, Inc. SCS -  2QFY25 Adj EPS of $0.39 Beats WTR Est of $0.36

Thematic (Sector/Industry)

<ul><li>SCS and LZB both reported strong earnings. Steelcase gained 7.2% for the week after posting strong orders and margins in 1QFY25 with adjusted EPS of $0.16, beating consensus of $0.10 and our estimate of $0.11. LZB surged 12.4% after posting adjusted 4QFY24 EPS of $0.95 versus consensus of $0.70.</li><li>It was a mixed week for the Water Tower Research Furniture/Furnishings indexes.</li><li>The Commercial/Contract Furniture Index was up 3.3% for the week, while the Residential Manufacturers &amp; Suppliers Index was down 1.1% and the Home Goods Retailers Index was down 1.2%. </li></ul>

SCS and LZB both reported strong earnings. Steelcase gained 7.2% for the week after posting strong orders and margins in 1QFY25 with adjusted EPS of $0.16, beating consensus of $0.10 and our estimate of $0.11. LZB surged 12.4% after posting adjusted 4QFY24 EPS of $0.95 versus consensus of $0.70.It was a mixed week for the Water Tower Research Furniture/Furnishings indexes.The Commercial/Contract Furniture Index was up 3.3% for the week, while the Residential Manufacturers &amp; Suppliers Index was down 1.1% and the Home Goods Retailers Index was down 1.2%. 

Furniture/Furnishings Weekly - June 24, 2024

<ul><li>We introduce our new revenue and earnings estimates and full financial model following</li><li>Steelcase’s 1QFY25 earnings beat versus consensus and WTR estimates.</li><li>Steelcase posted 1QFY25 adjusted EPS of $0.16 versus $0.09 in 1QFY24, beating consensus of $0.10 and our estimate of $0.11.</li></ul>

We introduce our new revenue and earnings estimates and full financial model followingSteelcase’s 1QFY25 earnings beat versus consensus and WTR estimates.Steelcase posted 1QFY25 adjusted EPS of $0.16 versus $0.09 in 1QFY24, beating consensus of $0.10 and our estimate of $0.11.

Steelcase, Inc. - Revising Revenue and EPS Estimates Following 1QFY25 Results

<ul><li>We are publishing new estimates for our Steelcase economic model after its solid 4QFY24 earnings.</li><li>Adjusted EPS of $0.23 beat our estimate as well as consensus. Revenue of $775.2 million modestly missed estimates.</li><li>1QFY25: We tweaked our non-GAAP (adjusted) EPS estimate to $0.11 ($0.10 previously).</li></ul>

We are publishing new estimates for our Steelcase economic model after its solid 4QFY24 earnings.Adjusted EPS of $0.23 beat our estimate as well as consensus. Revenue of $775.2 million modestly missed estimates.1QFY25: We tweaked our non-GAAP (adjusted) EPS estimate to $0.11 ($0.10 previously).

Steelcase, Inc. - Tweaking FY25 Estimates; Encouraged by Orders and Cash Flow

United States

Steelcase Inc. designs and manufactures products used to create high performance work environments.  The Company's products include office furniture, furniture systems, interior architectural products, technology products, seating, and related products and services.  Steelcase has operations in various countries.

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Steelcase Inc Cl A (SCS US)

Steelcase, Inc. - Updating EPS and Revenue Estimates on Margin Strength

We are revising our EPS and revenue estimates following Steelcase’s 2QFY25 earnings release and investor call. See our update note for a summary of...

Water Tower Research

Steelcase, Inc. SCS - 2QFY25 Adj EPS of $0.39 Beats WTR Est of $0.36

SCS posted 2QFY25 adjusted EPS of $0.39, $0.03 ahead of WTR’s estimate of $0.36 and $0.02 better than consensus of $0.37. GAAP EPS of $0.53...

Water Tower Research

Furniture/Furnishings Weekly - June 24, 2024

SCS and LZB both reported strong earnings. Steelcase gained 7.2% for the week after posting strong orders and margins in 1QFY25 with adjusted EPS...

Water Tower Research

Steelcase, Inc. - Revising Revenue and EPS Estimates Following 1QFY25 Results

We introduce our new revenue and earnings estimates and full financial model following. Steelcase’s 1QFY25 earnings beat versus consensus and WTR...

Water Tower Research

Steelcase, Inc. - Tweaking FY25 Estimates; Encouraged by Orders and Cash Flow

We are publishing new estimates for our Steelcase economic model after its solid 4QFY24 earnings. Adjusted EPS of $0.23 beat our estimate as well...

Water Tower Research

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