Espey Q2 Earnings Dip Y/Y Despite Record Orders Driving Sales Growth

Shares of Espey Mfg. & Electronics Corp. ESP have declined 1% since the company reported its earnings for the quarter ended Dec. 31, 2024. This compares to the S&P 500 index’s 0.3% decline over the same time frame. Over the past month, the stock has declined 6.2% against the S&P 500’s 1.5% growth.See the Zacks Earnings Calendar to stay ahead of market-making news.Espey reported a net income of 71 cents per share for the second quarter of fiscal 2025, down from 72 cents per share in the year-ago period. The company posted net sales of $13.6 million, representing a 32.1% increase from the $10.3 million recorded in the same quarter of the prior year. Net income for the quarter was $1.9 million compared to $1.8 million in the year-ago period. While sales growth was robust, earnings per share was likely influenced by cost factors.Espey Mfg. & Electronics Corp. Price, Consensus and EPS Surprise Espey Mfg. & Electronics Corp. price-consensus-eps-surprise-chart | Espey Mfg. & Electronics Corp. QuoteBacklog and Order Growth for ESPThe company’s backlog stood at approximately $120.1 million as of Dec. 31, 2024, significantly higher than $84.8 million at the same point in 2023. This increase reflects a strong inflow of new business, with new orders totaling $46.9 million in the first six months of fiscal 2025, more than double the $20.1 million received in the first half of fiscal 2024.ESP’s Management CommentaryCEO David O’Neil highlighted Espey’s record-breaking backlog and order flow, underscoring management’s confidence in sustaining revenue growth. The company reported a new all-time high in order intake, with $54 million in new orders as of the earnings release date, surpassing the prior annual record of $52 million set in fiscal 2024. While gross margins were described as “respectable,” O’Neil noted that the prior-year quarter benefited from one-time sales to specific customers. Management is focusing on cost-saving initiatives and improving production efficiencies, which could support stronger profitability in future periods.Factors Influencing PerformanceThe significant year-over-year sales increase was a key driver of revenue growth. However, the modest increase in net income suggests cost pressures or mix-related factors that limited profit expansion. The company’s ability to convert backlog into revenues efficiently while maintaining margins will be a key area to watch going forward.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Espey Mfg. & Electronics Corp. (ESP): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks