After years of lumbering lower in a downtrend since coming public in October 2013 around $10 a share, industrial products supplier Jason Industries (NASDAQ:JASN) looks to finally be making a comeback.
The Milwaukee-based company is the parent to a global family of companies employing over 4,300 people in 13 countries within the finishing, components, seating and automotive acoustics markets.
Shares dipped as low as 77 cents last August (a brief intraday drop after holding more realistically at a bottom support around $1.13) and have been retaking lost ground ever since, including touching $2.92 on January 8 to mark the highest point for the stock since August 2016.
On the back of a better-than-expected report for Q4 2017 and 2018 outlook, shares are rocketing ahead from Wednesday's close at $2.19 back towards that multi-year high.
Net sales actually slipped 8.3% to $145.5 million from $158.8 million in the year prior quarter, but the decrease included the negative impact of divesting a non-core business. It was the effect of restructuring that is beginning to bear fruit that is catching investor's attention.
The company has set a goal to shave $24 million of its annual spend, with the "cost reduction and margin expansion program" now reaching $20 million of the target as of the end of 2017.
Operating income increased to $68.9 million, inclusive of a $63.3 million of pre-tax impairment charges, to $1.4 million.
Looking at income on an adjusted basis, which Wall Street uses to weed out one-time items (like tax benefits or special charges), Jason posted a net loss of about $300,000, or one cent per share, up from a loss of 14 cents per share in Q4 2016 and way ahead of the 15 cents per share loss that analysts expected.
Brian Kobylinski, CEO at Jason Industries, noted some particular positives from the fourth quarter, such as strong organic growth in both the finishing and seating units, including the finishing business delivering double-digit growth (+10.2%) for the first time since the company went public.
Looking ahead at the full year 2018, Jason expects net sales between $600 - $615 million, adjusted EBITDA of $66 - $70 million and free cash flow of $13 - $17 million, which result in an implied net debt to Adjusted EBITDA range of 5.3 - 4.9x.
That's the type of figures Wall Street wanted to hear, pushing shares of JASN ahead 43.5 cents, or 19.9%, to $2.625 not quite 90 minutes into Thursday morning trading.
Related Stories
