Entering text into the input field will update the search result below

Kimball's Organic Sales Probably Just Bottomed

May 06, 2021 5:03 AM ETHNI Corporation (HNI)7 Comments
Alex Pitti profile picture
Alex Pitti


  • I believe Kimball's organic sales bottomed in Q3. The coming return to offices and increase in travel should provide growth in fiscal year 2022.
  • Kimball reported bad Q3 results which were a little worse than I expected. It was hurt by the pandemic, supply chain issues, and rising commodity costs.
  • We're seeing early anecdotal evidence that employers will bring workers back to offices this summer. This was confirmed by Kimball's increase in orders in April.
  • Domestic travel should rebound this summer which will provide a tailwind to the Hospitality business in fiscal year 2022.
  • Poppin's integration started in May with the launch of sales through Kimball's dealer network. Poppin also unveiled Spaces which is a flexible walls product.

Interior of an open plan office space
Photo by alvarez/E+ via Getty Images

Q3 Was The Bottom For Kimball

Kimball (KBAL) reported dreadful numbers in Q3 which makes sense because January was the peak in COVID-19 cases. However, investing is about looking forward. It doesn’t make much sense

This article was written by

Alex Pitti profile picture
I'm currently looking for an analyst position. If you like my posts, please shoot me a DM on here or email me at interviewsalexpitti@gmail.com.

Analyst’s Disclosure: I am/we are long KBAL. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (7)

Christopher Hasty profile picture
The quarter looked rough, particularly on orders.

Do you still prefer this over MLHR?
Alex Pitti profile picture
@Christopher Hasty yes.

Orders grew 6% monthly. I think they will recover
Christopher Hasty profile picture
From here it's certainly an easier target since it's down ~15% comparatively since last Monday.

I really question how Poppin is going to pan out. I don't think it's a brand that will resonate as well with buyers as the Kimball name. Knoll, Herman Miller, and Steelcase have leveraged their existing brand power as they have entered the e-commerce landscape. That acquisition seems like a reactionary move in my view.

Kimball investors expected hard times in the short run, but now they have the concern of an SG&A money-pit throttling the post-covid recovery in the long run. I know I'd be more apt to buy shares here again if they didn't own Poppin. (I haven't owned any of this since about 2009)
Alex Pitti profile picture
@Christopher Hasty It doesn't necessarily need to resonate with the same customers. It has a different price point. I would want it to be different or else they would cannibalize sales.

It doesn't matter if we think/don't think it will resonate. The proof will be in the sales. The company had been doing well before COVID. Now let's see how it does in 2022. It's way too early to judge the purchase because it will be integrated starting in May.

The company was getting no credit for the cash on the balance sheet. It had no e-business and work from home business before the pandemic. Plus, Poppin Pods and Spaces are innovative products the company didn't have. We will see early signs of whether the deal was smart in Q1 2022.
yazin profile picture
$KBAL isn't the only office furniture play in town. The fact that they missed earnings when comps like $HNI, $SCS and $MLHR didn't .. that makes me think twice before chalking up the miss to macro changes.
Alex Pitti profile picture
@yazin well Kimball doesn't have the exact same end markets as them. Kimball had virtually no exposure to work from home before the pandemic.

Furthermore, meeting or beating estimates certainly relates to analysts and guidance. There aren't that many analysts following Kimball. That being said, Kimball dropped the ball on guidance.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

About HNI

SymbolLast Price% Chg
Market Cap
Yield (TTM)
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on HNI

Related Stocks

SymbolLast Price% Chg
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.