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Virco Mfg. Corporation VIRC is expected to have generated stronger performance in second-quarter fiscal 2025.
In the last reported quarter, VIRC’s earnings per share (EPS) and net sales surpassed the Zacks Consensus Estimate by 200% and 24%, respectively. On a year-over-year basis, revenues increased 33.7% and EPS expanded 244.4%.
The company’s bottom line topped the consensus mark in seven of the trailing eight quarters.
Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s EPS has remained stable at $1.00 over the past 60 days. The estimated figure indicates 5.3% growth from the year-ago quarter’s 95 cents.
Virco Manufacturing Corporation Price and EPS Surprise
Virco Manufacturing Corporation price-eps-surprise | Virco Manufacturing Corporation Quote
The consensus mark for net sales is pegged at $115.9 million, indicating a rise of 8% year over year.
Factors to Note
VIRC is likely to have generated higher net sales and earnings in the fiscal second quarter. Virco’s vertically integrated model remains highly adaptable to assist schools in adjusting their calendars and curricula to address student learning challenges. This adaptability, coupled with solid control over inventories, delivery performance and the entire order-to-cash cycle, enables the company to generate better results.
Virco’s strategic decision to always keep its operations domestic has positioned it well in the current economic environment, mitigating labor and supply chain hurdles. Also, it is actively evaluating potential acquisitions to expand and strengthen its current capabilities via major equipment purchases, as well as bolt-on acquisitions of smaller companies or suppliers.
However, VIRC is experiencing a shrinking backlog, which is a good predictor of future revenues. This trend suggests potential revenue challenges in the upcoming busy seasons (fiscal second and third quarters) when schools typically place large orders for furniture. Also, declining inventory levels have been affecting the company. This decline could suggest an expectation of lower sales volumes in the fiscal second quarter.
What Our Quantitative Model Predicts
Our proven model does not conclusively predict an earnings beat for Virco this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.
Earnings ESP: The company presently has an Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Virco currently carries a Zacks Rank #3.