Johnson Controls (JCI) Q4 Earnings In Line, Improve Y/Y

Johnson Controls International plc (NYSE:JCI) posted adjusted earnings of 87 cents per share in fourth-quarter fiscal 2017 (ended Sep 30, 2017), which came in line with the Zacks Consensus Estimate.

Moreover, earnings increased 14% from 76 cents per share registered in fourth-quarter fiscal 2016. For full-year 2017, adjusted earnings came in at $2.60 per share, reflecting an increase of 13% from 2016.

Operational Update

Johnson Controls reported revenues of $8.14 billion, almost in line with the Zacks Consensus Estimate. Adjusted revenues in fourth-quarter 2016 came in at $7.85 billion.

For full-year 2017, adjusted revenues came in at $30.1 billion, reflecting an increase of 2% from 2016.

Cost of sales increased to $5.62 billion from $6.25 billion in the year-ago quarter. Gross profit increased to $2.5 billion from $1.7 billion in the year-ago quarter.

Selling, general and administrative expenses in fiscal fourth quarter totaled $1.25 billion, decreasing from the prior-year quarter figure of $1.55 billion.

Segment Results

Building Efficiency: This segment’s revenues came in at $6 billion, down 1% from the year-ago level. Organic sales increased 1%, driven by growth in product sales.

Quarter-end backlog increased 4% year over year. Orders, excluding M&A and adjusted for foreign exchange increased 2% year over year. Segment EBITA increased 5% year over year to $904 million.

Power Solutions: Revenues at the Power Solutions segment increased 18% to $2.13 billion. Excluding the impact of foreign exchange and higher lead pass-through costs, organic sales rose 9% year over year. Segment EBITA came in at $431 million, reflecting an increase of 22.8% from the year-ago quarter.

Financial Position

Johnson Controls had cash and cash equivalents of $321 million as of Sep 30, 2017, decreasing from $579 million as of Sep 30, 2016. Long-term debt escalated to $12 billion in the quarter from $11.1 billion as of Sep 30, 2016.

In the reported quarter, the company repurchased 5.5 million shares for $225 million.

Guidance

Johnson Controls provided guidance for fiscal 2018. Fiscal 2018 adjusted EPS before special items is projected to be in the range of $2.75 to $2.85, reflecting an increase of 6-10% year over year.

Zacks Rank & Key Picks

Johnson Controls currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the auto space are Navistar International Corporation (NYSE:NAV) , Cummins Inc. (NYSE:CMI) and PACCAR Inc. (NASDAQ:PCAR) , each sporting a Zacks Rank#1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Navistar has an expected long-term growth rate of 5%.

Cummins has an expected long-term growth rate of 12.1%.

PACCAR has an expected long-term growth rate of 10%.

Johnson Controls International PLC Price, Consensus and EPS Surprise

Johnson Controls International PLC Price, Consensus and EPS Surprise | Johnson Controls International PLC Quote

Today's Stocks from Zacks' Hottest Strategies

It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.

And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.

See Them Free>>