Bucyrus International, Inc. (BUCY), a leading manufacturer of heavy earthmoving equipment for surface and underground mining, reported better than expected second quarter results yesterday after the close. Revenues rose 66% year-over-year to $621.0 million vs. analysts’ estimates of $583.0 million. Net income soared 124% to $62.3 million, or 84 cents per diluted share, significantly beating analysts’ expectations by 18 cents per share.
Bucyrus is benefiting globally from the commodities boom. Strong demand and high prices for coal and iron ore provide clear visibility for the strength of Bucyrus’ business in the near future. New orders during the quarter increased 69% year-over-year to $776.5 million, and total backlog increased 51% to $2.17 billion.
Shares of BUCY closed at $59.27 yesterday and have traded in a range of $28.42 to $79.50 during the past year. Shares have declined 25% since hitting a 52-week high on June 17. The recent pullback mirrors the trading of equities across the entire coal sector. The coal ETF (KOL) is 26% off its high hit on June 19. The early pre-market bid for BUCY suggests a 7% gap higher on the open today. Shares of Joy Global, Inc. (JOYG), a Bucyrus competitor in the earth-moving space, could benefit in sympathy with a pop in BUCY. Joy Global reports third quarter earnings at the end of August.
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