ESAB Corporation (ESAB) shares plummeted 7.59% in pre-market trading on Wednesday, despite reporting better-than-expected third-quarter results and raising its full-year outlook. The significant drop in share price comes as a surprise, given the company's strong performance and improved guidance.
The welding and cutting equipment manufacturer reported Q3 adjusted earnings per share of $1.32, surpassing the analyst estimate of $1.26. Sales for the quarter reached $728 million, significantly exceeding the expected $677.6 million. ESAB's core adjusted EBITDA for Q3 stood at $133 million, demonstrating solid operational performance.
Adding to the positive news, ESAB raised its fiscal year 2025 outlook. The company now expects core adjusted EPS to be between $5.20 and $5.30, up from its previous guidance of $5.15 to $5.30. Additionally, ESAB increased its total core sales growth forecast to 4.5-5.5%, a substantial improvement from the earlier projection of 1.5-3.5%. Despite these upbeat figures, investors appear to be reacting negatively, possibly due to concerns about future growth prospects or broader market conditions not reflected in the current results.
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