Dj Brightview Holdings Down Over 13%, On Pace For Largest Percent Decrease Since February 2023 - Data Talk

BrightView Holdings, Inc. BV posted fourth-quarter fiscal 2024 results, wherein the top line declined year over year but surpassed the Zacks Consensus Estimate. The bottom line increased year over year but lagged the Consensus Estimate.

However, the company’s fourth-quarter results confirm fiscal 2024 as a breakthrough year, highlighting continued business transformation. The One BrightView culture is gaining momentum, positioning the company for fiscal 2025 to be another record-setting year.

BrightView Holdings, Inc. Price, Consensus and EPS Surprise

BrightView Holdings, Inc. price-consensus-eps-surprise-chart | BrightView Holdings, Inc. Quote

More on BV’s Q4 Results

This leading commercial landscaping services company posted adjusted quarterly earnings of 30 cents per share, showcasing an improvement from 19 cents in the year-ago period. However, the metric missed the Zacks Consensus Estimate of 31 cents per share.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

Total revenues of $728.7 million slightly surpassed the Zacks Consensus Estimate of $728 million and decreased 2% year over year. The decline was due to a drop in Maintenance Services revenues, partially offset by an increase in Development Services revenues.

The gross profit decreased 1.9% year over year to $182.1 million. We note that the gross margin is 25%, flat year over year.

Adjusted EBITDA increased almost 3.5% year over year to $105.2 million. Also, as a percentage of total revenues, the metric rose 70 basis points (bps) to 14.4%. The increase was driven by a $12.1 million rise in Development Services EBITDA, partially offset by a decline in Corporate EBITDA due to the disposal of corporate assets in the previous year.

BrightView’s Q4 Revenue Insights by Segments

In the fourth quarter, revenues for the Maintenance Services Segment declined 6.6% year over year to $486.5 million compared to the Zacks Consensus Estimate of $500 million. This decrease was due to a shortfall in core commercial landscape services, driven by strategic reductions in non-core business areas and, to a lesser extent, a reduction in ancillary services.

The segment’s adjusted EBITDA margin increased by 110 basis points to 16.8%, compared to 15.7% in 2023. This margin improvement was the result of lower overhead costs from the company’s cost management efforts, along with strategic reductions in non-core businesses.

Revenues for the Development Services Segment rose 8.6% year over year to $244.1 million, exceeding the Zacks Consensus Estimate of $229.8 million, due to higher project volumes. Also, the adjusted EBITDA margin improved by 390 basis points to 16.9% from 13% in the prior year. These gains in adjusted margin were driven by the revenue increase.

BV’s Financial Health Snapshot

BrightView ended the quarter with cash and cash equivalents of $140.4 million, long-term debt of $802.5 million and total shareholders’ equity of $1.28 billion.

Net cash provided by operating activities for the fiscal year ended Sept. 30, 2024, was $205.6 million. Free cash flow rose by $65.1 million for the fiscal year, reaching $145.3 million, up from $80.2 million in the previous year. Capital expenditures were $78.4 million in fiscal 2024.

BrightView’s Fiscal 2025 Outlook

For fiscal 2025, the company anticipates total revenues in the range of $2.75 to $2.84 billion. The company reported total revenues of $2.78 billion in fiscal 2024. Adjusted EBITDA is expected to be between $335 and $355 million compared with $324.7 million reported in fiscal 2024, while free cash flow is projected to range from $40 to $60 million.

Shares of this Zacks Rank #3 (Hold) company have increased 23.7% in the past three months as compared with the industry’s growth of 4.5%.

Key Picks

Some better-ranked stocks are Abercrombie & Fitch Co. ANF, Gildan Activewear Inc. GIL and Steven Madden, Ltd. SHOO.

Abercrombie is a specialty retailer of premium, high-quality casual apparel. It carries a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

ANF delivered a 16.8% earnings surprise in the last reported quarter.

The Zacks Consensus Estimate for Abercrombie’s fiscal 2025 earnings and sales indicates growth of 64.2% and 13%, respectively, from the fiscal reported levels. ANF has a trailing four-quarter average earnings surprise of 28%.

Gildan is a manufacturer and marketer of premium quality branded basic activewear for sale principally in the wholesale imprinted activewear segment of the North American apparel market. It currently carries a Zacks Rank #2.

The consensus estimate for Gildan’s current financial-year earnings and sales indicates growth of 15.6% and 1.5%, respectively, from the 2023 figures. GIL has a trailing four-quarter average earnings surprise of 5.4%.

Steven Madden designs, sources, markets and sells fashion-forward, name-brand and private-label footwear. It currently has a Zacks Rank of 2.

The Zacks Consensus Estimate for Steven Madden’s 2024 earnings and sales indicates growth of 8.2% and 13.4%, respectively, from the year-ago actuals. SHOO has a trailing four-quarter average earnings surprise of 9.8%.

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