Q2 Rundown: ESCO (NYSE:ESE) Vs Other Engineered Components and Systems Stocks

Wrapping up Q2 earnings, we look at the numbers and key takeaways for the engineered components and systems stocks, including ESCO (NYSE:ESE) 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.

Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data. However, engineered components and systems stocks have held steady amidst all this with share prices up 3.4% on average since the latest earnings results.

ESCO (NYSE:ESE)

A developer of the communication systems used in the Batmobile of “The Dark Knight,” ESCO (NYSE:ESE) is a provider of engineered components for the aerospace, defense, and utility sectors.

ESCO reported revenues of $260.8 million, up 4.8% year on year. This print fell short of analysts’ expectations by 6%. Overall, it was a weak quarter for the company with a miss of analysts’ earnings estimates and full-year revenue guidance missing analysts’ expectations.

Interestingly, the stock is up 5% since reporting and currently trades at $117.83.

Is now the time to buy ESCO? 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 scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 5.6% since reporting. It currently trades at $130.62.

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 had the weakest performance against analyst estimates in the group. As expected, the stock is down 10.4% since the results and currently trades at $44.91.

Read our full analysis of Worthington’s results here.

Gates Industrial Corporation (NYSE:GTES)

Helping create one of the most memorable moments for the iconic “Jurassic Park” film, Gates (NYSE:GTES) offers power transmission and fluid transfer equipment for various industries.

Gates Industrial Corporation reported revenues of $898.6 million, down 4% year on year, in line with analysts’ expectations. More broadly, it was a slower quarter for the company with underwhelming EBITDA guidance for the full year.

The stock is down 1.1% since reporting and currently trades at $17.53.

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

Regal Rexnord (NYSE:RRX)

Headquartered in Milwaukee, Regal Rexnord (NYSE:RRX) provides power transmission and industrial automation products.

Regal Rexnord reported revenues of $1.55 billion, down 12.5% year on year, surpassing analysts’ expectations by 2.7%. More broadly, it was a very strong quarter for the company with a solid beat of analysts’ organic revenue estimates.

The stock is flat since reporting and currently trades at $160.12.

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

Join Paid Stock Investor Research

Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.