Q: AFN is seems to be making a big move since they reported earnings. In your opinion, were their earnings that good?
5i Research Answer:
AFN beat EPS forecasts of $1.21 coming in at $1.7 in it's Q4 results. Revenue did miss forecasts of $406.93M coming in at $379.32M and grew 1.4% year-over-year. Backlog jumped by 25% year-over-year to $747M, with strength in both the Farm and Commercial segments. Adjusted EBITDA margin in the quarter increased by roughly 5.70% to 19.3% on a yearly basis. Adjusted EBITDA margin for the full year increased by around 3.2% from the prior year to 19.3%. The companies outlook was very positive for 2024 on the back of the growing backlog and project based nature of the business. We think these were good results despite the revenue miss and outlook for 2024 appears positive along with margin expansion and a growing backlog.