WESCO Hammered Down, But Margin Questions Linger
Stephen Simpson, CFA
Stephen Simpson, CFA
Margin Leverage Limiting WESCO's Potential
Stephen Simpson, CFA
Stephen Simpson, CFA
Thu, Jun. 2, 7:34 AM
- WESCO International, Inc. (WCC), a leading provider of electrical, industrial, and communications MRO and OEM products, construction materials, and advanced supply chain management and logistics services, today announced that its wholly-owned subsidiary, WESCO Distribution is planning, subject to market and other conditions, to offer $350 million aggregate principal amount of senior notes due 2024 in a private offering.
- The Company intends to use the net proceeds from the offering of the Notes to repay its 6.0% Convertible Senior Debentures due 2029, which are redeemable on or after September 15, 2016. Until the 2029 Debentures are repaid, the Company plans to use the net proceeds to temporarily reduce other debt facilities for which there are no prepayment penalties.
- WCC -1.1% after hours to $58.74.
- Source: Press Release
Thu, Apr. 28, 6:07 AM
Wed, Apr. 27, 5:30 PM
- AB, ABBV, ACOR, ADP, AEP, AET, AIT, ALKS, ALLE, ALXN, AME, APD, ASPS, AUO, AVT, AXTA, BC, BCOR, BG, BLL, BMS, BMY, BOFI, BWA, BWEN, BXLT, BZH, CAB, CAH, CBG, CCE, CELG, CHTR, CIT, CL, CLF, CLFD, CME, CMS, COMM, COP, COR, CRCM, CRI, CRR, CSH, CVI, CVRR, CWT, CY, DBD, DFT, DLX, DNKN, DOW, DPZ, EME, EPD, EQM, EQT, F, FCFS, FCN, GEO, GLOP, GNC, GOV, GTLS, GWR, HAR, HEES, HHS, HMC, HUN, I, IDA, IDCC, INGR, INSY, INT, IPGP, IQNT, IRDM, IRM, ITC, ITCI, IVC, IVZ, KERX, LANC, LBY, LKQ, LVLT, MA, MD, MDP, MHO, MINI, MITK, MJN, MMC, MO, MPC, MPLX, MSCI, MTH, NEE, NEWM, NOV, OAK, ODFL, ORI, OSK, PF, PJC, POT, PPL, PRLB, PTEN, QSR, RGS, RTIX, RTN, RUTH, SABR, SCG, SEE, SFE, SIRI, SNAK, SNE, SPB, SPIL, SQNS, TFX, THRM, TMO, TOWR, TPX, TWC, TZOO, UAN, UBSI, UFS, UPS, UTHR, VA, VAC, VC, VIAB, VIVO, WCC, WM, WNS, WST, XRS, YNDX, ZBH
Tue, Apr. 5, 10:28 AM
- First Data (NYSE:FDC): "Despite its favorable debt maturity schedule (nothing due until 2018) and modest interest rate sensitivity (only approximately 1/4 of debt is floating), FDC appears to have suffered collateral damage in the recent high-yield credit market carnage. Nonetheless, we remain encouraged by FDC's positioning within the payment-processing ecosystem and continue to believe the company is well positioned to benefit from the secular trend toward electronic payments."
- T-Mobile USA (NASDAQ:TMUS): "T-Mobile's improving cash generation coupled with ongoing subscriber momentum reinforces our outperform rating. The company appears on track for 20% EBITDA growth in 2016/17. We continue to believe TMUS's standalone story is attractive with M&A upside [long term]."
- HCA: "We are recommending shares of HCA given strong Q4 results, a robust outlook, improved Affordable Care Act enrollment trends, and an attractive valuation. HCA's Q4 beat and bullish FY2016 outlook, released on January 29, 2016, were far in excess of expectations. Nevertheless, the stock has re-traced only a portion of its post-Q3 losses. Besides the Q3 earnings challenges, the market remains concerned with the outlook for the ACA, balance sheet leverage and mixed competitor results, but those concerns appear overblown. The stock is now trading at just 7.1x '16E EBITDA, which is a discount to the company's/industry's historical averages of 7.6x/8.6x."
- Expedia (NASDAQ:EXPE): Expedia is "our top long-term idea. The company is well positioned to gain online-travel share from its leading travel brands, solid management execution, and strategic deployment of capital. We believe the HomeAway acquisition is highly accretive, based on leveraging HomeAway's unique inventory with Expedia's online optimization capabilities. As a result, we forecast superior earnings growth that should result in significant shareholder value, in our view."
- FedEx (NYSE:FDX): "FedEx is lauded for its speed and service in its core FedEx Express segment, where it possesses the leading market share in 'express' parcel delivery in the U.S., as well as a strong position in its emerging FedEx Ground segment, both of which (particularly Ground) are benefiting from an e-commerce tailwind, which we estimate is driving formidable revenue growth in business-to-consumer. Anticipating a gradual economic recovery in the US/globally, we expect margin expansion via improved efficiencies and capital utilization, coupled with a realignment plan likely to meet/exceed targeting improved annual profitability of $1.65 billion by FY16."
- CVS: "The company continues to do well in the PBM (pharmacy benefit management) segment, taking new market share ($12.7 billion net new business) while integrating the newly acquired Omnicare and Target pharmacies. We believe that CVS's focus around building solutions that span the continuum of care will resonate well with clients. Near term, the continued strength in new PBM business and acquisition synergies will likely drive the upside. CVS's focus on delivering shareholder returns in multiple avenues - earnings growth, share buybacks and dividends, makes it very attractive, especially in this turbulent market."
- Fidelity National Information Services (NYSE:FIS): "The SunGard integration appears ahead of plan; we would not preclude upside synergies (i.e., above $200 million FY17 exit rate). FIS currently trades at approximately 14x our FY17E EPS, which we believe remains attractive."
- Coach (NYSE:COH): "With Creative Designer Stuart Vevers' influence on full-price channel for five quarters and impact on outlet at approximately 90% this [past holiday season], we are starting to see signs of stabilization of Coach brand in North America. All in all, at 17% operating margins (31% just two years ago) and early signs of brand inflection, COH is playing better offense, despite moderation in growth of overall handbag category, and likely stands to benefit from biggest competitor KORS slowing."
- WESCO (NYSE:WCC): "We believe WCC's hires into key strategic leadership positions in recent years support improved guidance rigor and represent a long-term investment in deeper organizational productivity potential across sales & marketing, supply chain, and IT (new CIO most recently). WCC remains positioned to drive long-term market share gains in the fragmented U.S. electrical distribution market in our view, as nonresidential and industrial capex markets recover. We note meaningful leverage to a sustained and more broad-based recovery and attractive long-term investment characteristics."
- Anthem (NYSE:ANTM): "Overall, while the Exchanges continue to cause shorter-term pressure, we think improvements to this business, along with the potential accretion from Cigna remain attractive long-term catalysts for the company. As a result, we maintain our Outperform rating."
Thu, Jan. 28, 6:05 AM
Wed, Jan. 27, 5:30 PM
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Dec. 15, 2015, 9:40 AM
- Wesco International (WCC +2.5%) opens higher despite issuing downside guidance for FY 2016, seeing EPS of $3.75-$4.20 vs. $4.22 analyst consensus estimate, sales coming in flat to -5%, vs. consensus expectations for flat sales, and free cash flow generation of at least 90% of net income.
- WCC reaffirms its 2015 outlook for EPS of $4.15-$4.30 vs. $4.22 analyst consensus, a sales decline of 4%-5% vs. -5% consensus, and free cash flow generation of ~100% of net income.
- WCC says it expects reduced demand in commodity-driven end markets and foreign exchange headwinds to continue throughout next year.
Oct. 22, 2015, 6:53 AM
- WESCO (NYSE:WCC): Q3 EPS of $1.28 beats by $0.05.
- Revenue of $1.92B (-7.7% Y/Y) misses by $60M.
Oct. 21, 2015, 5:30 PM
- AB, ACAT, ACOR, ADS, AEP, ALK, APOL, ASPS, BCC, BEN, BHE, BMS, CAB, CAM, CAT, CBU, CEMP, COR, CRS, CY, DAN, DGX, DHR, DLX, DNKN, DOW, DPS, DST, EQM, EQT, FAF, FCX, FNB, GMT, GPK, GRA, HBAN, HUB.B, IVC, JNS, LAZ, LLY, LUV, MCD, MHO, MINI, MJN, MMM, NDAQ, NUE, NWE, ORI, PCP, PDS, PENN, PH, PHM, PRLB, PTEN, R, RCI, RS, RTN, SIRI, SJR, SNA, SQNS, STC, SWK, TCB, TROW, UA, UAL, UNP, USG, UTEK, WAB, WBC, WCC, XRS
Jul. 23, 2015, 6:02 AM
- WESCO (NYSE:WCC): Q2 EPS of $1.00 misses by $0.16.
- Revenue of $1.92B (-4.5% Y/Y) misses by $50M.
Apr. 23, 2015, 6:06 AM
- WESCO (NYSE:WCC): Q1 EPS of $0.90 misses by $0.11.
- Revenue of $1.82B (+0.6% Y/Y) misses by $80M.
Mar. 23, 2015, 3:18 PM
- Barclays sours on the multi-industry conglomerate sector, downgrading Dover (NYSE:DOV), Israel Chemical (NYSE:ICL), Wesco (NYSE:WCC), W.W. Grainger (NYSE:GWW), Xylem (NYSE:XYL) to Neutral from Outperform, seeing a scenario where stock returns are limited to mid-single-digit levels in 2015 and only slightly better in 2016, while rising cycle risks cap any upside to P/E multiples.
- However, the firm offers plenty of praise for Outperform-rated General Electric (NYSE:GE), which it says is "in the midst of positive change" thanks to the simplification of GE's industrial holdings, a shrinking asset base in GE Capital, outsized margin improvements, best-in-class dividend yield, and potential for management change.
- Barclays believes that in a year in which the S&P may stumble and lower commodity prices and forex headwinds will mean muted EPS growth in the multi-industry group, GE’s industrial earnings growth can move into the sector's top quartile.
Jan. 29, 2015, 6:03 AM
- WESCO (NYSE:WCC): Q4 EPS of $1.40 misses by $0.08.
- Revenue of $2B (+6.4% Y/Y) in-line.
Oct. 23, 2014, 6:12 AM
- WESCO (NYSE:WCC): Q3 EPS of $1.52 beats by $0.02.
- Revenue of $2.08B (+7.8% Y/Y) beats by $30M.
Jul. 24, 2014, 6:24 AM
- WESCO International (NYSE:WCC): Q2 EPS of $1.29 misses by $0.06.
- Revenue of $2.01B (+6.3% Y/Y) in-line.
Apr. 24, 2014, 6:19 AM
- WESCO International (WCC): Q1 EPS of $0.97 misses by $0.10.
- Revenue of $1.81B (flat Y/Y) misses by $20M.
WESCO International, Inc. provides electrical, industrial, and communications maintenance, repair and operating, and original equipment manufacturers products, construction materials, and advanced supply chain management and logistics services. Its primary product categories include general... More
Industry: Industrial Equipment Wholesale
Country: United States
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