Limbach 4Q Revenues Disappoint; Shares Drop

Limbach Holdings reported 4Q earnings that fared better than analysts’ expectations. However, the commercial specialty contract services provider reported lower-than-expected revenues following which its stock is down about 3.4% in Friday’s pre-market trading session.

Limbach Holdings’ (LMB) revenues declined 6.1% year-over-year to $130.4 million in 4Q and missed the Street’s expectations of $135.6 million. While the Service segment’s revenues grew 24.8% year-over-year, the Construction segment’s revenues declined 14% year-over-year.

The company reported 4Q earnings of $0.05 per share, which declined 37.5% year-over-year. Analysts were expecting a loss of $0.01 per share.

CEO Charlie Bacon said, “Although we saw some deceleration in revenue and sales in the fourth quarter due to a pause in decision-making by business owners across the non-residential construction industry, we anticipate that to be a temporary issue. We believe the drivers underlying the industry as a whole, and several of Limbach’s core end-markets specifically continue to be supportive.” (See Limbach Holdings stock analysis on TipRanks)

On March 5, Lake Street analyst Robert Brown initiated coverage on Limbach Holding with a Buy rating. The analyst remains positive on Limbach’s improving capital structure. Brown believes that the company would benefit from a mix shift toward higher-margin, higher-growth services.

Brown maintains a price target of $19 (69.2% upside potential) on the stock. Shares have gained over 320% in the past year.

On TipRanks’ Smart Score ranking, Limbach Holdings gets a 7 out of 10, suggesting that the stock is likely to perform in-line with the market expectations.

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