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What: Shares of Mohawk Industries (NYSE: MHK ) were looking stronger today, gaining as much as 10% after the flooring specialist topped earnings estimates in its first-quarter report.
So what: Mohawk delivered an adjusted EPS of $0.87, 50% above its year-ago total, and $0.02 better than the analyst consensus. Revenue increased 5.5% to $1.5 billion, but missed estimates. CEO Jeffrey Lorberbaum said improvements in the U.S market helped counteract the slowdown in Europe, and noted that the company recently closed on its acquisition of the Marazzi Group, which makes Mohawk No. 1 in ceramic tile around the world. Second-quarter EPS guidance at $1.58-$1.67 came in ahead of the analyst consensus of $1.58.
Now what: After last night's earnings announcement, Mohawk reported this morning that it had made another acquisition, purchasing Belgian panel-board manufacturer, Spano Group, for 125 million Euros. The slew of recent purchases seems to show that management is focused on growth and strengthening the company's position in key markets and products. Like most growth stocks, Mohawk shares aren't cheap at a P/E of 31, but that strategy should pay off in the long run.
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