What Awaits Matrix Service Company (MTRX) In Q1 Earnings?
Zacks Investment Research | Nov 04, 2019 01:49AM ET
Matrix Service Company (NASDAQ:MTRX) is set to release fiscal first-quarter 2020 results after the closing bell on Wednesday, Nov 6. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of 26 cents per share on revenues of $397 million.
Let’s delve into the factors that might have influenced the company’s performance in the quarter ended September.
Factors to Consider
Strong operational performance at Matrix’s Storage Solutions division, which is responsible for more than 50% of the company’s operating income, is likely to have contributed to its fiscal first-quarter bottom line. In the previous three-month period, the company’s segment income surged to $8.7 million compared with just $802,000 in last year’s corresponding period. This trend most likely continued in the fiscal first quarter, primarily driven by higher tank and terminal construction volumes from recent project awards.
Additionally, the company’s Oil Gas & Chemical segment is expected to have benefited from strong project execution associated with maintenance works. Moreover, robust iron and steel work is likely to have contributed to the Industrial unit sales.
But on a bearish note, cost headwinds might have dampened the performance of this provider of engineering, fabrication, construction and repair and maintenance services. Matrix’s cost of sales in the fiscal fourth-quarter of 2019 came 30.7% above the year-ago quarter. The cost structure is likely to have deteriorated in the to-be-reported quarter as well due to higher-than-expected power project outlays in the Electrical Infrastructure segment.
What Does Our Model Say?
The proven Zacks model does not conclusively predict that Matrix is likely to beat estimates in the fiscal first quarter. The combination of a positive Zacks Investment Research
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