Winners And Losers Of Q2: Enpro (NYSE:NPO) Vs The Rest Of The Engineered Components and Systems Stocks

As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the engineered components and systems industry, including Enpro (NYSE:NPO) and its peers.

Engineered components and systems companies possess technical know-how in sometimes narrow areas such as metal forming or intelligent robotics. Lately, automation and connected equipment collecting analyzable data have been trending, creating new demand. On the other hand, like the broader industrials sector, engineered components and systems companies are at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.

The 13 engineered components and systems stocks we track reported a mixed Q2. As a group, revenues missed analysts’ consensus estimates by 0.9% while next quarter’s revenue guidance was 0.9% below.

Inflation progressed towards the Fed’s 2% goal at the end of 2023, leading to strong stock market performance. On the other hand, 2024 has been a bumpier ride as the market switches between optimism and pessimism around rate cuts and inflation. However, engineered components and systems stocks have held steady amidst all this with share prices up 4% on average since the latest earnings results.

Enpro (NYSE:NPO)

Holding a Guinness World Record for creating the world's largest gasket, Enpro (NYSE:NPO) designs, manufactures, and sells products used for machinery in various industries.

Enpro reported revenues of $271.9 million, down 1.8% year on year. This print was in line with analysts’ expectations, and overall, it was a strong quarter for the company with a solid beat of analysts’ earnings estimates and in-line EBITDA guidance for the full year.

“Enpro delivered strong performance in the second quarter, headlined by record profitability in Sealing Technologies. In Advanced Surface Technologies, we saw sequential improvement in segment revenue and adjusted segment EBITDA. For the remainder of the year, while we still expect sequential improvement in AST, we now expect the magnitude of recovery in semiconductor capital equipment spending to be more gradual,” said Eric Vaillancourt, President and Chief Executive Officer.

Interestingly, the stock is up 5.8% since reporting and currently trades at $154.49.

Is now the time to buy Enpro? Access our full analysis of the earnings results here, it’s free.

Best Q2: Arrow Electronics (NYSE:ARW)

Founded as a single retail store, Arrow Electronics (NYSE:ARW) provides electronic components and enterprise computing solutions to businesses globally.

Arrow Electronics reported revenues of $6.89 billion, down 19% year on year, outperforming analysts’ expectations by 5.7%. It was an exceptional quarter for the company with an impressive beat of analysts’ earnings estimates.

Arrow Electronics achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 6.1% since reporting. It currently trades at $131.18.

Is now the time to buy Arrow Electronics? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Worthington (NYSE:WOR)

Founded by a steel salesman, Worthington (NYSE:WOR) specializes in steel processing, pressure cylinders, and engineered cabs for commercial markets.

Worthington reported revenues of $318.8 million, down 13.6% year on year, falling short of analysts’ expectations by 9.6%. It was a weak quarter for the company with a miss of analysts’ earnings estimates.

Worthington posted the weakest performance against analyst estimates in the group. As expected, the stock is down 10.8% since the results and currently trades at $44.72.

Read our full analysis of Worthington’s results here.

Graham Corporation (NYSE:GHM)

Founded when its founder patented a unique design for a vacuum system used in the sugar refining process, Graham (NYSE:GHM) provides vacuum and heat transfer equipment for the energy, petrochemical, refining, and chemical sectors.

Graham Corporation reported revenues of $49.95 million, up 5% year on year, in line with analysts’ expectations. Revenue aside, it was a mixed quarter for the company with an impressive beat of analysts’ earnings estimates but underwhelming EBITDA guidance for the full year.

Graham Corporation had the weakest full-year guidance update among its peers. The stock is up 2.3% since reporting and currently trades at $29.71.

Read our full, actionable report on Graham Corporation here, it’s free.

NN (NASDAQ:NNBR)

Formerly known as Nuturn, NN (NASDAQGS:NNBR) provides metal components, bearings, and plastic and rubber components to the automotive, aerospace, medical, and industrial sectors.

NN reported revenues of $123 million, down 1.8% year on year, in line with analysts’ expectations. Overall, it was a strong quarter for the company with an impressive beat of analysts’ earnings estimates and favorable EBITDA guidance for the full year.

The stock is up 14.5% since reporting and currently trades at $3.80.

Read our full, actionable report on NN here, it’s free.

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