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Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

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<ul><li>We are raising our non-GAAP (adjusted) EPS estimates for 4Q23 and 2024 following HNI’s strong 3Q23 earnings report on Tuesday, October 31, 2023.</li><li>Our sales estimates have moderated. Following the 3Q23 report, margins should be sustainably stronger.</li><li>HNI reported 3Q23 adjusted EPS of $0.93, $0.30 better than consensus. Sales were roughly in line. </li></ul>

We are raising our non-GAAP (adjusted) EPS estimates for 4Q23 and 2024 following HNI’s strong 3Q23 earnings report on Tuesday, October 31, 2023.Our sales estimates have moderated. Following the 3Q23 report, margins should be sustainably stronger.HNI reported 3Q23 adjusted EPS of $0.93, $0.30 better than consensus. Sales were roughly in line. 

HNI Corporation - Raising Estimates Following Strong 3Q Earnings Report

<ul><li>Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.</li><li>Positive surprises on the gross margin line accounted for the beat. Sales were roughly in line with expectations at $711.7 million versus our $713 million estimate.</li><li>Our pre-report concerns were answered with strong performance.</li></ul>

Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.Positive surprises on the gross margin line accounted for the beat. Sales were roughly in line with expectations at $711.7 million versus our $713 million estimate.Our pre-report concerns were answered with strong performance.

HNI Corporation - 3Q23 Margins Beat Expectations

<ul><li>HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET. </li><li>We expect 3Q23 non-GAAP EPS of $0.64 on consolidated sales of $713 million. Consensus is $0.63 EPS on consolidated sales of $713 million.</li><li>In 3Q22, HNI delivered $0.71 in non-GAAP EPS on consolidated sales of $598.8 million.</li></ul>

HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET. We expect 3Q23 non-GAAP EPS of $0.64 on consolidated sales of $713 million. Consensus is $0.63 EPS on consolidated sales of $713 million.In 3Q22, HNI delivered $0.71 in non-GAAP EPS on consolidated sales of $598.8 million.

HNI Corporation - 3Q Preview: Looking for Steady Demand in WF Segment

<div><div><div><div><ul style="list-style-type: disc;"><li><p>We are revising our recent estimates for HNI to correct a significant error in our understanding of guidance for the contribution to revenue and earnings from the Kimball International (KII) acquisition.</p></li><li><p>We misunderstood the guidance for 2H revenue for KII to be in the range of $340-370 million.</p></li><li><p>That number applies to the full-year contribution, including $52 million already reported. </p></li></ul></div></div></div></div>

We are revising our recent estimates for HNI to correct a significant error in our understanding of guidance for the contribution to revenue and earnings from the Kimball International (KII) acquisition.We misunderstood the guidance for 2H revenue for KII to be in the range of $340-370 million.That number applies to the full-year contribution, including $52 million already reported. 

HNI Corporation - Revising Estimate to Correct Modeling Error(S)

<div><div><div><div><ul style="list-style-type: disc;"><li><p>With this note, we are updating our estimates for FY23 and FY24 to reflect the surprisingly strong margin performance in legacy HNI Workplace Furnishings, the integration of Kimball International (KII), and promised margin improvement in Residential Building Products (Hearth).</p></li><li><p>One note on how we have modeled the next four quarters.</p></li><li><p>Through 2QFY24, we are modeling KII revenues and operating income independent of the legacy WF. </p></li></ul></div></div></div></div>

With this note, we are updating our estimates for FY23 and FY24 to reflect the surprisingly strong margin performance in legacy HNI Workplace Furnishings, the integration of Kimball International (KII), and promised margin improvement in Residential Building Products (Hearth).One note on how we have modeled the next four quarters.Through 2QFY24, we are modeling KII revenues and operating income independent of the legacy WF. 

HNI Corporation - Integrating KII and Updating Estimates

United States

HNI Corporation manufactures and markets office furniture as well as hearth products. The Company's products are sold primarily through dealers, wholesalers, and retail superstores. HNI has operations in the United States and Canada.

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HNI Corp (HNI US)

HNI Corporation - Raising Estimates Following Strong 3Q Earnings Report

We are raising our non-GAAP (adjusted) EPS estimates for 4Q23 and 2024 following HNI’s strong 3Q23 earnings report on Tuesday, October 31, 2023.

Water Tower Research

HNI Corporation - 3Q23 Margins Beat Expectations

Before market open today, HNI reported 3Q23 adjusted EPS of $0.94, substantially ahead of our estimate of $0.64 and consensus of $0.63.

Water Tower Research

HNI Corporation - 3Q Preview: Looking for Steady Demand in WF Segment

HNI reports 3Q23 on Tuesday, October 31 before the market opens, with its earnings conference call scheduled for 11:00 am ET.

Water Tower Research

HNI Corporation - Revising Estimate to Correct Modeling Error(S)

We misunderstood the guidance for 2H revenue for KII to be in the range of $340-370 million. That number applies to the full-year contribution,...

Water Tower Research

HNI Corporation - Integrating KII and Updating Estimates

One note on how we have modeled the next four quarters. Through 2QFY24, we are modeling KII revenues and operating income independent of the legacy...

Water Tower Research

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