Why Haynes International Stock Rallied Over 18% at the Open Today
Shares of Haynes International (NASDAQ: HAYN), a maker of high-performance alloys, rose dramatically at the open of trading on Friday, gaining just shy of 19% in the first hour or so of the day. Although that gain had cooled by roughly 11a.m. ET, the shares were still higher by a solid 13% or so. The big news was the company's fiscal third-quarter 2022 earnings update, which hit the market after the close on July 28. The reading was good across the board.
On the top line, Haynes' sales increased 11.2% sequentially versus the fiscal second quarter and a huge 47.7% compared to the fiscal third quarter of 2021. Sales in the aerospace market were particularly notable, up 15.2% sequentially and 79.6% year over year. Management noted that aerospace sales are now at roughly 95% of their pre-pandemic levels in 2019. Earnings of $1.24 per share were up 85% year over year.
The company's profitability was aided by high utilization rates at its factories, which have a notable amount of fixed costs. Thus, once sales exceed those costs, the money flows disproportionately into earnings because the business' variable costs aren't as material as its fixed costs.
Source Fool.com
