Titanium Repurchases Shares - Analyst Blog
September 27 2011 - 9:26AM
Zacks
Titanium Metals
Corporation (TIE)
announced that its Board of Directors recently authorized the
repurchase of 400,000 shares of its common stock at an average
price of $14.939 (exclusive of commissions).
Few days
back, the Board also authorized the repurchase of 400,000 shares of
its common stock at an average price of $14.6281 exclusive of
commissions. The Board also authorized the repurchase of 100,000
shares of its common stock at an average price of $14.6644 and
251,627 shares of its common stock at an average price of $15.0778
both exclusive of commissions.
Last month,
Titanium released its second quarter 2011 results. The company
reported net earnings of $31.5 million or 18 cents per share in the
second quarter of 2011, surpassing the Zacks Consensus Estimate of
16 cents and increasing from the prior-year earnings of $19.0
million or 11 cents per share.
Quarterly
revenues of $272 million increased 28.3% year over year, beating
the Zacks Consensus Estimate of $267 million. Increased sales were
driven by a rise in sales volumes for both melted and mill
products, primarily reflecting improved demand for titanium
products in the commercial aerospace sector.
Cost of
sales jumped 22.1% over the prior-year quarter to $209.1 million.
As a percentage of sales, costs plunged 76.9% in the reported
quarter from 80.8% in the year-ago quarter. For the second quarter
of 2011, gross profit was $62.9 million compared with $40.8 million
in the second quarter of 2010, reflecting higher sales volume and
the related efficiencies resulting from greater utilization of its
manufacturing capacity, as demand continued to improve.
Titanium
Metals faced increased demand in the industrial sector as
infrastructure and chemical projects were reinvigorated by the
global economic recovery. The company expects this trend to
continue in 2011. The company also expects to drive efficiency
through process technology and cost reduction
initiatives.
Delaware-based Titanium
Metals is the leading worldwide producer of titanium metal
products.
Titanium
Metals has been successful over the last several years in
establishing significant flexibility and cost advantages in its
entire manufacturing process. The company’s fiscal discipline and
industry experience have allowed it to manage its production rates
and costs effectively while investing capital conservatively and
maintaining a strong, debt-free balance sheet.
The
company’s financial strength and operating flexibility position it
to take advantage of opportunities to strengthen and expand its
presence in key markets. The company competes with
Allegheny Technologies
Inc. (ATI)
and RTI
International Metals, Inc. (RTI).
We maintain
our Neutral recommendation on Titanium. Currently, it holds a Zacks
#3 Rank (Hold).
ALLEGHENY TECH (ATI): Free Stock Analysis Report
RTI INTL METALS (RTI): Free Stock Analysis Report
TITANIUM METALS (TIE): Free Stock Analysis Report
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