General Industrial Machinery Stocks Q2 Teardown: Hillenbrand (NYSE:HI) Vs The Rest

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how general industrial machinery stocks fared in Q2, starting with Hillenbrand (NYSE:HI).

Automation that increases efficiency and connected equipment that collects analyzable data have been trending, creating new demand for general industrial machinery companies. Those who innovate and create digitized solutions can spur sales and speed up replacement cycles, but all general industrial machinery companies are still at the whim of economic cycles. Consumer spending and interest rates, for example, can greatly impact the industrial production that drives demand for these companies’ offerings.

The 14 general industrial machinery stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 8.5% while next quarter’s revenue guidance was 4% below.

Inflation progressed towards the Fed's 2% goal recently, leading the Fed to reduce its policy rate by 50bps (half a percent or 0.5%) in September 2024. This is the first cut in four years. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be debating whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.

General Industrial Machinery stocks have held steady amidst all this with average share prices relatively unchanged since the latest earnings results.

Hillenbrand, Inc. (NYSE: HI) is an industrial company that designs, manufactures, and sells highly engineered processing equipment and solutions for various industries.

Hillenbrand reported revenues of $786.6 million, up 9.8% year on year. This print fell short of analysts’ expectations by 3.9%. Overall, it was a slower quarter for the company with a miss of analysts’ earnings estimates and underwhelming EBITDA guidance for the full year.

"We're pleased with our progress in executing our strategy during the quarter in light of a tougher than expected macro environment. Our FPM integration continued to progress well and exceeded our expectations for margin performance. However, due to the challenging macro environment, we experienced significantly lower than expected orders and revenue in our Advanced Process Solutions segment. This level of performance was primarily due to continued customer project delays, which became more widespread throughout the quarter given ongoing concerns around interest rates, inflation, and broader macroeconomic uncertainty," said Kim Ryan, President and Chief Executive Officer of Hillenbrand.

Unsurprisingly, the stock is down 25.9% since reporting and currently trades at $28.18.

Read our full report on Hillenbrand here, it’s free.

Producers of the first asthma inhaler, 3M Company (NYSE:MMM) is a global conglomerate known for products in industries like healthcare, safety, electronics, and consumer goods.

3M reported revenues of $6.02 billion, down 24.7% year on year, outperforming analysts’ expectations by 3.3%. The business had an exceptional quarter with an impressive beat of analysts’ operating margin estimates and a solid beat of analysts’ organic revenue estimates.

The market seems happy with the results as the stock is up 31.7% since reporting. It currently trades at $136.22.

Is now the time to buy 3M? Access our full analysis of the earnings results here, it’s free.

Tracing back to its invention of the mechanical milk bottle filler in 1884, John Bean (NYSE:JBT) designs, manufactures, and sells equipment used for food processing and aviation.

John Bean reported revenues of $402.3 million, down 5.9% year on year, falling short of analysts’ expectations by 7%. It was a softer quarter as it posted a miss of analysts’ earnings estimates.

Interestingly, the stock is up 1.9% since the results and currently trades at $98.41.

Read our full analysis of John Bean’s results here.

Originally founded in 1906 as a thermostat company, Honeywell (NASDAQ:HON) is an aerospace and defense manufacturing company building technologies, performance materials, and safety and productivity solutions.

Honeywell reported revenues of $9.58 billion, up 4.7% year on year. This print topped analysts’ expectations by 1.7%. Overall, it was an exceptional quarter as it also logged full-year revenue guidance exceeding analysts’ expectations and an impressive beat of analysts’ organic revenue estimates.

Honeywell pulled off the highest full-year guidance raise among its peers. The stock is up 2.2% since reporting and currently trades at $218.40.

Read our full, actionable report on Honeywell here, it’s free.

Headquartered in Massachusetts, Kadant (NYSE:KAI) is a global supplier of high-value, critical components and engineered systems used in process industries worldwide.

Kadant reported revenues of $274.8 million, up 12.1% year on year. This print beat analysts’ expectations by 4.3%. It was a very strong quarter as it also logged an impressive beat of analysts’ operating margin estimates and full-year revenue guidance exceeding analysts’ expectations.

Kadant had the weakest full-year guidance update among its peers. The stock is down 6% since reporting and currently trades at $334.83.

Read our full, actionable report on Kadant here, it’s free.

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