Cabot's Earnings Surpass Estimates in Q2, Revenues Miss

Cabot Corporation CBT recorded second-quarter fiscal 2025 (ended March 31, 2025) earnings of $1.69 per share, up from the year-ago quarter's earnings of $1.49.CBT posted adjusted earnings of $1.90 per share, up from the year-ago quarter figure of $1.78. It surpassed the Zacks Consensus Estimate of $1.86.The company’s net sales in the fiscal second quarter were $936 million, which missed the Zacks Consensus Estimate of $1,038.1 million. Net sales decreased around 8.2% from the prior-year quarter.(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)Cabot Corporation Price, Consensus and EPS Surprise Cabot Corporation price-consensus-eps-surprise-chart | Cabot Corporation QuoteCBT’s Segment HighlightsReinforcement Materials’ sales decreased around 12.1% year over year to $594 million in the reported quarter, missing the Zacks Consensus Estimate of $678.5 million. Earnings before interest and tax (EBIT) in the segment were $131 million, down around 12.1% from the year-ago quarter. EBIT fell primarily due to lower volumes as a result of lower tire demand and contract outcomes in South America.Sales in the Performance Chemicals unit were flat year over year at $311 million, missing the Zacks Consensus Estimate of $328.9 million in the reported quarter. EBIT increased around 61.2% to $50 million. The company's fumed metal oxides product line drove higher volumes, with sales volumes for construction and semiconductor applications reconnecting to underlying demand drivers.CBT’s FinancialsThe company concluded the second quarter of fiscal 2025 with a cash balance of $213 million. During the quarter, cash flows from operating activities generated $73 million. Capital expenditures for the fiscal second quarter totaled $72 million. During the quarter, cash was also used to pay dividends of $23 million and repurchase shares worth $47 million.CBT’s OutlookThe company noted that the first half of the fiscal year developed in line with its initial expectations. However, in light of the uncertain impact of recently implemented tariff policies on customer demand in the second half of the fiscal year, the company has revised its adjusted EPS guidance for fiscal 2025 to a range of $7.15 to $7.50. While the direct impact of the tariffs is anticipated to be limited, the updated outlook reflects an expectation of softer demand as customers take a more cautious approach to inventory management.The revised guidance also assumes that the company will sustain profit margins consistent with those achieved in the second fiscal quarter. Despite the evolving external environment, the company remains confident in its ability to adapt effectively and continue executing its strategy with discipline and agility.CBT’s Price PerformanceShares of Cabot have declined 27% in the past year compared with a 30.4% fall of the industry.Image Source: Zacks Investment ResearchCBT’s Zacks Rank & Key PicksCBT currently carries a Zacks Rank #4 (Sell).Better-ranked stocks worth a look in the basic materials space include Hawkins, Inc. HWKN, Contango Ore, Inc. CTGO and Avino Silver & Gold Mines Ltd. ASM, each carrying a Zacks Rank #1 (Strong Buy).  You can see the complete list of today’s Zacks #1 Rank stocks here.Hawkins is scheduled to report fiscal fourth-quarter results on May 14. The consensus estimate for Hawkins’ earnings is pegged at 74 cents. HWKN beat the consensus estimate in one of the last four quarters while missing thrice, with the average earnings surprise being 6.1%. Contango Ore is slated to release first-quarter results on May 14. CTGO has a trailing four-quarter earnings surprise of 213.7%, on average.  Avino Silver & Gold Mines is slated to release first-quarter results on May 13. The consensus estimate for ASM’s first-quarter earnings is pegged at 3 cents. ASM has a trailing four-quarter earnings surprise of 94.4%, on average.  Zacks' Research Chief Names "Stock Most Likely to Double"Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.This top pick is among the most innovative financial firms. With a fast-growing customer base (already 50+ million) and a diverse set of cutting edge solutions, this stock is poised for big gains. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cabot Corporation (CBT): Free Stock Analysis Report Avino Silver (ASM): Free Stock Analysis Report Hawkins, Inc. (HWKN): Free Stock Analysis Report Contango ORE, Inc. (CTGO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks