Research from Water Tower Research, Water Tower Research

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.

Research from Water Tower Research

Equity Research Firm

Equity Bottom-Up

<ul><li>MLKN bettered our expectations for revenue (+$15 million versus our estimate) and adjusted EPS (+$0.03 versus our estimate) even as industry conditions remained challenged.</li><li>Gross margin, down 33 bps to 38.8%, was affected by product mix, while the 81-bp decline in operating margin to 7.1% was due to higher variable and compensation expenses andthe need to ‘preload’ marketing expense in Global Retail even as the calendar split the critical holiday/cyber promotional period between 2Q and 3Q.</li><li><p>Americas Contract and Global Retail posted solid quarters amid industry headwinds, while International Contract demand (typically more variable) was down.</p></li></ul>

MLKN bettered our expectations for revenue (+$15 million versus our estimate) and adjusted EPS (+$0.03 versus our estimate) even as industry conditions remained challenged.Gross margin, down 33 bps to 38.8%, was affected by product mix, while the 81-bp decline in operating margin to 7.1% was due to higher variable and compensation expenses andthe need to ‘preload’ marketing expense in Global Retail even as the calendar split the critical holiday/cyber promotional period between 2Q and 3Q.Americas Contract and Global Retail posted solid quarters amid industry headwinds, while International Contract demand (typically more variable) was down.

MillerKnoll

MillerKnoll, Inc - 2QFY25 Adj. EPS $0.55