Why Apogee Enterprises Inc (NASDAQ:APOG) Shares Could Be Poised for Gains


Apogee Enterprises Inc (NASDAQ:APOG) shares were down 4.22% on Wednesday but jumped 9.40% in after-hours trading to $45.40. Shares have been moving in a 52-week range of $33.67 to $61.05.

Apogee Enterprises is a company that is engaged in the design and development of glass solutions for enclosing commercial buildings and framing art. It has four main segments: Architectural Glass, Architectural Services, Architectural Framing Systems and Large-Scale Optical Technologies (LSO).

In its Q1 earnings report, the company printed earnings per share of $0.61, beating the consensus estimate of $0.49 by $0.12. This is also higher than the company’s earnings per share of $0.41 in the same period last year. Revenue for the quarter came in at $247.9 million versus the consensus estimate of $247.18 million, representing a 3.3% gain on a year-over-year basis. The company also recently  declared a quarterly dividend paid in late May, amounting to a $0.50 dividend on an annualized basis and a dividend yield of 1.20%

As for its guidance, Apogee Enterprises projects earnings per share of $2.70 to $2.85 for FY 2016. This is higher than prior guidance of $2.65 to $2.80, indicating that management is feeling optimistic about the company’s prospects for the rest of the year.

The latest earnings report may have been one of the main reasons for the upgraded outlook, as it goes to show how the company has been able to adapt its business to changing times. In addition, components of the earnings report revealed that some of the headwinds previously encountered by the company may be starting to ease. For one, the impact of currency fluctuations only resulted to a single percentage point reduction in revenue. In addition, operating margin rose once more, indicating that the company is doing well in terms of maximizing profit and minimizing costs.

Moving forward, Apogee Enterprises predicts that this rebound could last for the long haul. The company has plans to expand in new areas, products, and markets, aiming to have at least 12% operating margin on revenues of as much as $1.3 billion by 2018.


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