![]() Moreover, the company guided for a solid 2021 with earnings seen between $3.00 and $3.50 per share (on an adjusted basis).Īfter a solid first quarter, the company hiked the midpoint of the full-year earnings guidance to $4.00 per share, with this midpoint maintained during the second and third quarter, with full-year EBITDA seen at $475-$500 million. Net debt was cut to $900 million which was rapidly getting more comfortable with adjusted EBITDA coming in at $366 million. Even as the company posted a meaningful decline in full-year sales to $8.5 billion, the company managed to report adjusted earnings of $2.26 per share for the year, with fourth quarter earnings coming in as high as $1.14 per share. Momentum was fueled by solid 2020 results, as released in February 2021. Shares even hit a high of $50 in the first half of 2021, fell back to $30 in October that year, before recovering to trade around the $40 mark, and now trading hands at $37 per share. ![]() Since voicing a somewhat cautious tone, I must say that shares have done well, in part because the pandemic lasted longer than many thought and hoped, of course. The situation was a bit difficult as the run rate of the second half of 2020 revealed a $3 per share roadmap, yet much of this has been the result of the pandemic, as the question is what the real earnings power would look like after the pandemic, certainly with Movianto being sold as well. With shares trading at $27 in October, the 69 million shares were valued at $1.9 billion, or $2.9 billion if we factor in the pro forma net debt load. The company hiked the earnings guidance to $1.75-$1.90 per share in September, with strength set to continue in 2021 as the company furthermore sold 8.5 million shares at $20.50 per share in October, as leverage ratios should fall to just 2 times, killing that leverage overhang. Shares rose to $15 in the summer that year as the Movianto deal brought in $133 million in proceeds, while its products were in demand as a result of Covid-19, which made the full-year earnings per share guidance double. ![]() Net debt of $1.44 billion and EBITDA of $300 million created a very dicey situation with 2020 earnings seen at $0.50-$0.60 per share. With the deal not delivering upon its promises in 20, the company aimed to address this with its intention to divest the Movianto business, needed as 2019 results were not pretty.Īfter all, sales were down 2% to $9.2 billion, yet adjusted profits only came in at $34 million, or $0.60 per share. This deal, leverage (overhang), lack of earnings, and lack of prospects made that shares were down to just $5 at the start of 2020, just ahead of the pandemic.Īfter all, the Halyard deal was set to create a $10 billion business, albeit with very modest margins with EBITDA seen around $360 million, a bit high given that net debt jumped to $1.5 billion and the dividend commitments were high. This deal has been at the root of the issues described above. ![]() I remember the days that Owens & Minor looked like a decent play when its shares traded in their thirties in 2016, but I questioned a $710 million deal to acquire Halyard Health´s surgical and infection prevention business a year later. This reduced the leverage overhang which in combination with improved earnings power resulted in a huge recovery and belief in the shares. Stagnating sales, non-inspiring margins, and a debt-loaded balance sheet made investors very cautious, as the pandemic came at just the right time, with a divestment and equity issue further bolstering the balance sheet. ![]() In October 2020, I concluded that shares looked a lot healthier, as shares had five-folded on the back of the pandemic. Owens & Minor ( NYSE: OMI) has come to life during the pandemic. ![]()
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