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Investing.com - Citi maintained its neutral rating and $62.00 price target on HB Fuller (NYSE:FUL) following the company’s second-quarter earnings results that exceeded expectations. According to InvestingPro analysis, the company currently appears undervalued, with a GOOD overall financial health score of 2.58 out of 5.
HB Fuller reported adjusted earnings per share of $1.18 for the fiscal second quarter of 2025, surpassing Citi’s estimate of $1.14 and FactSet consensus of $1.08. The company’s adjusted EBITDA reached approximately $166 million, exceeding Citi’s $160 million estimate and hitting the high end of guidance. The company maintains strong profitability metrics, with a gross profit margin of nearly 30% and positive earnings yield of 5%.
The adhesives manufacturer posted a 0.4% year-over-year increase in overall organic sales, with the Hygiene, Health and Consumables (HHC) segment leading growth. Pricing increased 0.7% compared to the same period last year, while segment margin declines were less severe than in the first quarter of fiscal 2025.
HB Fuller raised its fiscal year 2025 midpoint EBITDA guidance to approximately $623 million, up from the previous guidance of approximately $613 million, essentially lifting the forecast by the amount of the second-quarter beat. The company also improved the low end of its full-year sales guidance, now projecting a 3% decline versus the previous forecast of a 4% drop.
For the third quarter of fiscal 2025, HB Fuller provided midpoint EBITDA guidance of $170 million, which exceeded the consensus estimate of approximately $166 million. Citi noted that categories including medical and flexible packaging remain strong, with signs of improvement in the overall volume environment. The company has demonstrated consistent shareholder returns, maintaining dividend payments for 55 consecutive years and achieving a 14.6% dividend growth in the last twelve months. Get deeper insights into HB Fuller’s financial performance and access exclusive ProTips with InvestingPro, where subscribers can explore comprehensive analysis and valuation metrics in our detailed Pro Research Report.
In other recent news, H.B. Fuller Company reported second-quarter results that surpassed earnings expectations, prompting an increase in its full-year guidance. The company posted adjusted earnings per share of $1.18, exceeding analyst estimates of $1.08, while revenue reached $898 million, slightly below the consensus forecast of $900.07 million but marking a 2.8% year-over-year increase when accounting for divestitures. H.B. Fuller has raised its full-year 2025 adjusted EPS guidance to a range of $4.10-$4.30, surpassing the previous analyst consensus of $4.08. The company also anticipates adjusted EBITDA of $615-$630 million, indicating 4-6% year-over-year growth. CEO Celeste Mastin attributed the strong financial performance to disciplined execution, successful pricing actions, and cost-saving efforts. For the second quarter, adjusted EBITDA increased 5% year-over-year to $166 million, with the adjusted EBITDA margin expanding by 130 basis points to 18.4%. The company projects a full-year 2025 net revenue decline of 2-3%, with organic revenue remaining flat or growing up to 2%. Additionally, foreign exchange is expected to negatively impact revenue by 1.0-1.5%.
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