Olympic Steel Reports Higher-Than-Expected GAAP EPS, But Misses Revenue Estimate
May 5, 2023
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The company reported higher-than-expected earnings per share (EPS) on a generally accepted accounting principles (GAAP) basis, but missed the estimates for revenue.
However, the company’s reported revenue of $573M was lower than anticipated by $23.6M. Olympic Steel ($NASDAQ:ZEUS) has been in business for over one hundred years and is one of the leading metal service providers in the United States. The company provides customers with a range of flat-rolled steel products such as hot and cold rolled steel, coated steel, and stainless steel. They also offer value-added services such as slitting, cut-to-length, and re-stocking. Olympic Steel has a wide customer base, including manufacturers, construction companies, and other industrial organizations.
Earnings
In the latest earning report of FY2022 Q4, Olympic Steel reported total revenue of 520.04M USD and net income of 3.96M USD. Compared to the same quarter last year, total revenue decreased by 16.7%, and net income decreased by 84.1%. While the results were lower than expected by analysts, it still exceeded their GAAP EPS estimates.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Olympic Steel. More…
| Total Revenues | Net Income | Net Margin |
| 2.56k | 90.93 | 3.6% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Olympic Steel. More…
| Operations | Investing | Financing |
| 185.85 | -16.56 | -166.91 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Olympic Steel. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 891.63 | 375.66 | 46.36 |
Key Ratios Snapshot
Some of the financial key ratios for Olympic Steel are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 17.5% | 100.4% | 5.2% |
| FCF Margin | ROE | ROA |
| 6.5% | 16.2% | 9.4% |
Price History
The stock opened at $46.2 and closed at $44.0, dropping by 5.9% from the prior closing price of $46.8. Live Quote…
Analysis
At GoodWhale, we performed an analysis on OLYMPIC STEEL‘s wellbeing. Our Star Chart rated the company strong in asset, dividend, growth, and medium in profitability. OLYMPIC STEEL has an intermediate health score of 6/10 with regard to its cashflows and debt, which indicates that it might be able to safely ride out any crisis without the risk of bankruptcy. We classified OLYMPIC STEEL as a ‘cheetah’ company – one that has achieved high revenue or earnings growth, but is considered less stable due to lower profitability. This type of company may appeal to investors looking for high-growth potential with an understanding of the risks associated with investing in such a company. More…
Peers
The steel industry is highly competitive, with Olympic Steel Inc facing off against Reliance Steel & Aluminum Co, Commercial Metals Co, and Lohakit Metal PCL. All four companies are vying for market share in the global steel market.
– Reliance Steel & Aluminum Co ($NYSE:RS)
Reliance Steel & Aluminum Co is a metals service center company. The Company provides value-added metals processing services and distributes a line of approximately 100,000 metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel and specialty metals. The Company operates through metals service centers segment. As of December 31, 2016, the Company operated through a network of approximately 300 metals service centers located in 39 states in the United States and in 13 other countries, including Australia, Belgium, Canada, China, France, Mexico, Singapore, South Korea, Spain, the Netherlands, the United Kingdom and Vietnam.
– Commercial Metals Co ($NYSE:CMC)
Commercial Metals Company is an American recycling company headquartered in Irving, Texas. The company manufactures, recycles and markets steel and metal products, related materials and services through a network including steel minimills, steel recycling facilities, downstream metals recyclers and metal fabrication plants.
As of 2022, Commercial Metals Company had a market capitalization of 5.59 billion dollars and a return on equity of 30.45%. The company’s strong financial position and commitment to shareholder value creation through disciplined reinvestment has resulted in consistent returns for investors over time. Commercial Metals Company is a well-positioned player in the global steel and metals industry, with a diversified product offering, a robust recycling platform and a growing presence in high-growth markets.
– Lohakit Metal PCL ($SET:LHK)
Lohakit Metal Public Company Limited is a Thailand-based company engaged in the manufacture and distribution of aluminum products and other metal products. The Company’s products include aluminum sheets, coils and strips, aluminum pipes and tubes, aluminum bars and rods, aluminum wire rods, aluminum plates, and others. It also provides services in aluminum product processing, such as cutting, punching, bending and welding. The Company operates its business through two business segments: aluminum products and others. The Company has its manufacturing plants located in Rayong Province and Samut Sakhon Province, Thailand.
Summary
Despite the positive earnings beat, the stock price moved down the same day, indicating that investors were disappointed by the revenue miss. Going forward, investors will be closely watching how Olympic Steel navigates the current market environment and adjusts their operations to maximize profits and ensure long-term success.
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