Keep Your Eyes on This Stock Alert: Primo Water Corporation (NASDAQ: PRMW)

Primo Water Corporation stock identified change of 15.93% away from 52-week low price and recently located move of -32.35% off 52-week high price. PRMW stock has been recorded 1.36% away from 50 day moving average and -13.29% away from 200 day moving average. Moving closer, we can see that shares have been trading 7.23% off 20-day moving average.

Primo Water Corporation (PRMW) recently stated financial results for the third quarter and nine months ended September 30, 2019.  In a separate press release issued recently, the Company also reported that Matt Sheehan was terminated as President and Chief Executive Officer and that Billy D. Prim, the Company’s Founder, Executive Chairman, and former Chairman & CEO, has been designated Interim President and CEO, effective immediately.

Business Highlights:

Net sales increased 6.4% to $87.0M.

Adjusted net sales, not including ice results, increased 10.5%.

Exchange net sales increased 12.7% to a record $24.2M.

Dispenser net sales increased 53.1% to a record $18.3M.

U.S. Exchange same-store-sales unit growth of 18.3%.

Record Dispenser sell-thru units of 236,000.

Third Quarter Results

Net sales increased 6.4% to $87.0M from $81.8M for the previous year quarter, at the high-end of the Company’s quarterly guidance.  Net sales adjusted for the June 2019 sale of the Company’s Ice assets (“Adjusted Net Sales”) increased 10.5% to $87.0M from $78.7M for the previous year quarter.

Dispenser section net sales increased 53.1% to $18.3M from $11.9M for the previous year quarter, driven by record consumer demand, or sell-thru of 236,000 units, as well as the timing of shipments as retailers prepare for fourth quarter promotions.

Exchange net sales increased 12.7% to $24.2M from $21.5M for the previous year quarter, driven by continued strength in U.S. same-store unit sales, which increased to a 2019 high of 18.3%.

Refill net sales were $44.5M contrast to $48.3M for the previous year quarter, primarily Because of the sale of the Company’s Ice assets.  Adjusted Net Sales for Refill, not including the Ice results, reduced 1.8%Because of fewer locations and lower overall sales volumes.

Gross margin percentage was 25.6%, contrast to 28.7% for the previous year quarter.  The decrease was a result of the increase in sales mix for Dispensers, which represented 21.0% of total sales contrast to 14.6% in the previous year quarter, as well as lower margins in Refill and Exchange.  Dispenser gross margin for the quarter reduced to 3.5% from 5.2% primarily as a result of changes in product and consumer mix.  Exchange gross margin reduced to 29.8% from 31.1%, primarily related to the increased investments in the free water program. Refill gross margin for the quarter reduced to 32.4% from 33.4%, primarily the result of the lower volume and incremental operating costs related to addressing downtime.

Selling, general and administrative (“SG&A”) expenses increased to $8.0M from $7.4M for the previous year quarter, primarily Because of increased non-cash, stock-based compensation.  Adjusted SG&A, not including non-cash, stock-based compensation, reduced 4.3% to $7.0M or 8.1% of net sales, from $7.3M or 9.0% of net sales for the previous year quarter.

Interest expense increased to $3.4M from $2.5M for the previous year quarter. The increase was due primarily to a $0.8M non-cash charge related to the change in fair market value of an interest rate swap.

Net income was $2.6M, or $0.06 per diluted share, contrast to a net loss of $58.2M, or $1.45 per diluted share in the previous year quarter. The previous year quarter was influenced by $67.9M of impairment losses.  Adjusted net income, a non-U.S. GAAP measure, was $4.3M, or $0.10 per diluted share, contrast to adjusted net income of $7.5M, or $0.18 per diluted share, for the previous year quarter.

Primo Water Corporation noticed change of 4.14% to $11.06 along volume of 380713 shares in recent session compared to an average volume of 251.1K. PRMW’s shares are at -14.79% for the quarter and driving a -22.28% return over the course of the past year and is now at -21.06% since this point in 2018.   The average volatility for the week at 3.48% and for month was at 3.28%. There are 37.68M shares outstanding and 35.81M shares are floated in market. Right now, the stock beta is 0.71.