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Investing.com -- Benchmark Electronics, Inc. (NYSE:BHE) reported second quarter earnings that slightly beat analyst expectations, but shares fell 3% as investors appeared unimpressed with the results and guidance.
The electronics manufacturing services provider posted adjusted earnings per share of $0.55 for the second quarter, narrowly exceeding the analyst estimate of $0.54. Revenue came in at $642 million, just above the consensus estimate of $639 million but down 3.6% compared to $666 million in the same quarter last year.
For the third quarter, Benchmark Electronics provided revenue guidance of $635-685 million, with the midpoint of $660 million falling below the analyst consensus of $667.1 million. The company expects adjusted earnings per share between $0.56 and $0.62, with the midpoint of $0.59 slightly above the consensus estimate of $0.58.
"Benchmark’s second quarter results continue to validate our strategy. We are the partner of choice for complex product execution, from concept through design to global delivery and support," said Jeff Benck, Benchmark’s President and CEO. "My conviction in our strategy and execution has never been higher."
The company reported sequential growth across most sectors, with continued strength in Aerospace & Defense (A&D), which grew to 20% of total revenue, and recovery in the Industrial and Medical (TASE:BLWV) sectors. The Semi-Cap segment remained the largest contributor at 30% of revenue, though it declined slightly from the first quarter.
Benchmark’s adjusted operating margin was 4.7% for the quarter, an improvement from 4.6% in the first quarter but below the 5.1% reported in the same quarter last year. The company also improved its cash conversion cycle to 85 days, down from 90 days in the year-ago period.
Despite the modest earnings beat and management’s optimistic outlook, investors responded negatively to the results, sending shares down 3% following the announcement.
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