ABM Stock Price Decreases 12% Since Reporting Q2 Earnings Miss

ABM ABM reported mixed second-quarter fiscal 2025 results. Earnings per share (EPS) missed the Zacks Consensus Estimate, while revenues beat the same.

Dismal earnings results and weak EPS guidance disappointed investors, as the ABM stock has declined 12.3% since the release of results on June 6.

For fiscal 2025, ABM expects an adjusted EPS of $3.65-$3.80. The mid-point of the guided range ($3.73) is lower than the Zacks Consensus Estimate of $3.74.

ABM’s EPS (excluding 19 cents from non-recurring items) was 86 cents, which missed the Zacks Consensus Estimate by 1.2% and declined 1.2% year over year. Total revenues of $2.1 billion surpassed the consensus mark by 2.2% and increased 4.6% from the year-ago quarter.

The company’s shares have declined 5.3% in the past three months against the12.2% rally of the industry and the 5.5% rise of the Zacks S&P 500 composite.

ABM’s Segmental Revenues

The Business & Industry segment’s revenues gained 2.6% on a year-over-year basis to $1 billion and met our estimate. Healthy office leasing activity aided this segment’s growth. The Manufacturing & Distribution segment’s revenues increased 2.4% from the year-ago quarter to $398.1 million, missing our estimation of $369.6 million. Strong industrial activity, new business pipeline and expansion efforts have been benefiting this segment’s growth.

The aviation segment’s revenues increased 9.2% from the year-ago quarter to $260.1 million, missing our estimate of $253.2 million. Robust domestic air travel led to the aviation segment’s growth.

The education segment’s revenues were $227.8 million, a marginal rise from the year-ago quarter. It missed our estimate of $228.3 million. The marginal rise in this segment’s revenues is facilitated by the continued focus on large school districts and universities.

Technical solutions gained 19.3% from second-quarter fiscal 2024 to $210.2 million. The metric missed our estimate of $214.5 million. Multiple factors, including strong microgrid business, $700 in total segment backlog and high demand in data centers, led to this segment’s improvement.

Profitability Performance of ABM

Adjusted EBITDA was $125.9 million, up 4% from the year-ago quarter. The adjusted EBITDA margin was 6.2%, flat with second-quarter fiscal 2024.

ABM’s Balance Sheet & Cash Flow

The company exited second-quarter fiscal 2025 with cash and cash equivalents of $58.7 million compared with $59 million at the end of the preceding quarter. The long-term debt (net) was $1.5 billion flat with the first quarter of fiscal 2025. Net cash utilized by operating activities was $32.3 million for the quarter. The free cash flow was $15.2 million.

ABM currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Earnings Snapshot

S&P Global Inc. SPGI reported impressive first-quarter 2025 results.

SPGI’s adjusted EPS of $4.37 surpassed the Zacks Consensus Estimate by 3.6% and gained 9% year over year. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Revenues of $3.8 billion beat the consensus estimate by 2% and grew 8.3% year over year.

Verisk VRSK posted impressive first-quarter fiscal 2025 results.

VRSK’s adjusted earnings were $1.73 per share, surpassing the Zacks Consensus Estimate by 3.6% and increasing 6.1% from the year-ago quarter. Total revenues of $753 million beat the consensus estimate marginally and increased 7% on a year-over-year basis.

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This article originally published on Zacks Investment Research (zacks.com).

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