Smart-home device maker Resideo Technologies (REZI) on Thursday beat Wall Street’s target for sales in the fourth quarter, but missed on earnings. The Resideo earnings news sent the company’s stock lower in early trading.
The Austin, Texas-based company earned 13 cents a share on sales of $1.27 billion in the December quarter. Analysts expected Resideo earnings of 23 cents a share on sales of $1.25 billion. On a year-over-year basis, revenue rose 5% in the fourth quarter.
On an adjusted basis, Resideo earned 31 cents a share in the fourth quarter, missing the consensus target of 54 cents.
The company said costs related to its spin-off from Honeywell International (HON) came in higher than expected in the fourth quarter. Resideo spun off from Honeywell on Oct. 29. It provides residential security and comfort solutions under the Honeywell Home brand.
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Resideo Earnings: Establishing Roadmap For Growth
Resideo stock fell 5%, near 23.50, in premarket trading on the stock market today.
“As a newly independent company, we are establishing our roadmap for growth and long-term value creation,” Chief Executive Mike Nefkens said in a news release.
He added, “This year is foundational for Resideo as we take critical steps near-term to further improve our cost base, invest to accelerate growth, increase margins and drive recurring revenues.”
For 2019, Resideo expects revenue to increase 2% to 5%. The midpoint of 3.5% is below its previous guidance of 4% growth. The updated guidance “reflects moderating housing metrics (and) shifting portfolio mix,” it said.
Resideo also said it is “actively targeting several opportunities for partnerships and tuck-in acquisitions with businesses that would enhance its software and data services capabilities.”
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