H.B. Fuller Company (FUL) is gearing up to report its fourth-quarter earnings after the bell on Wednesday, January 14, and Wall Street is expecting a solid performance from the adhesives specialist.
The Saint Paul, Minnesota-based company is projected to post earnings of $1.21 per share, which would represent a healthy jump from the 92 cents per share it reported in the same quarter last year. That's the kind of year-over-year improvement that gets investors' attention.
Revenue expectations tell a slightly different story. Analysts are forecasting quarterly revenue of $901.34 million, which is actually down from $923.28 million in the prior-year period. So we're looking at earnings growth on lower revenue, suggesting improved margins or operational efficiency.
What the Most Accurate Analysts Are Saying
The analyst community has been busy revisiting their H.B. Fuller thesis lately, and several top-rated analysts have made notable moves:
Citigroup analyst Patrick Cunningham upgraded the stock from Neutral to Buy back in October, bumping his price target from $62 to $70. This analyst carries a 58% accuracy rate on his calls.
Seaport Global analyst Michael Harrison also upgraded the stock from Neutral to Buy in late September, setting an even more optimistic price target of $80. Harrison has a 60% accuracy track record.
Baird analyst Ghansham Panjabi, who boasts the highest accuracy rate of the bunch at 77%, maintained his Outperform rating in June while raising his price target from $60 to $75.
Not everyone is equally enthusiastic. JP Morgan analyst Jeffrey Zekauskas maintained his Underweight rating in June, though he did raise his price target modestly from $50 to $54. This analyst has a 64% accuracy rate.
It's worth noting that Harrison from Seaport Global previously downgraded the stock from Buy to Neutral back in March before reversing course with his September upgrade.
Recent Developments
On the corporate side, H.B. Fuller announced in October that it appointed Celine Martin to its Board of Directors, adding fresh perspective to the company's governance.
The stock has been performing well heading into earnings, gaining 3.5% on Friday to close at $65.48. That puts the share price right in the middle of the range that most analysts see as fair value, with price targets spanning from $54 on the low end to $80 on the high end.
Investors will be watching Wednesday's report closely to see if the company can deliver on those elevated earnings expectations, and more importantly, what management has to say about the revenue trajectory going forward.