Oshkosh (OSK) Stock Falls on Lower EPS Guidance

NEW YORK (TheStreet) -- Shares of Oshkosh (OSK) were falling 7.6% to $46.48 on heavy trading volume Tuesday after the truck manufacturer lowered its earnings guidance for the fiscal year 2015.

Oshkosh lowered its fiscal 2015 EPS estimates to a range of $3.75 to $4 a share, down from its previous EPS estimates of a range of $4 to $4.25 a share. Analysts expect the company to report earnings of $4.04 a share for fiscal 2015.

The company said the lower EPS guidance is due to the impact of severe weather conditions, potential rental industry consolidation, and new product launch delays.

About 1.2 million shares of Oshkosh were traded by 10:27 a.m. Tuesday, above the company's average trading of about 829,000 shares a day.

TheStreet Ratings team rates OSHKOSH CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:

"We rate OSHKOSH CORP (OSK) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. We feel its strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Net operating cash flow has significantly increased by 68.81% to -$18.40 million when compared to the same quarter last year. In addition, OSHKOSH CORP has also vastly surpassed the industry average cash flow growth rate of -21.56%.
  • The current debt-to-equity ratio, 0.47, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.76 is somewhat weak and could be cause for future problems.
  • OSHKOSH CORP's earnings per share declined by 16.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, OSHKOSH CORP increased its bottom line by earning $3.61 versus $3.54 in the prior year. This year, the market expects an improvement in earnings ($4.05 versus $3.61).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.3%. Since the same quarter one year prior, revenues slightly dropped by 7.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • You can view the full analysis from the report here: OSK Ratings Report

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