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Northwest Pipe Company (NWPX)
NASDAQ:NWPX

Northwest Pipe Company (NWPX) AI Stock Analysis

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Northwest Pipe Company

(NASDAQ:NWPX)

74Outperform
Northwest Pipe Company demonstrates strong financial performance with solid revenue growth and effective cost management, translating into a high financial performance score. The technical analysis, however, indicates short-term bearish trends, which moderately impacts the overall score. Valuation remains reasonable, and positive sentiment from the latest earnings call further supports the company's strong outlook. Despite some market challenges, the company's strategic positioning and operational strengths offer a promising long-term perspective.

Northwest Pipe Company (NWPX) vs. S&P 500 (SPY)

Northwest Pipe Company Business Overview & Revenue Model

Company DescriptionNorthwest Pipe Company, together with its subsidiaries, manufactures and supplies water related infrastructure products in North America. It operates in two segments, Engineered Steel Pressure Pipe (SPP) and Precast Infrastructure and Engineered Systems (Precast). The SPP segment offers large-diameter, high-pressure steel pipeline systems for use in water infrastructure applications, which are primarily related to drinking water systems. Its products are also used for hydroelectric power systems, wastewater systems, and other applications. In addition, this segment makes products for industrial plant piping systems and certain structural applications. The Precast segment provides precast and reinforced concrete products, including manholes, box culverts, vaults, catch basins, oil water separators, pump lift stations, biofiltration, and other environmental and engineered solutions. The company sells its water infrastructure products primarily to installation contractors. Northwest Pipe Company was incorporated in 1966 and is headquartered in Vancouver, Washington.
How the Company Makes MoneyNorthwest Pipe Company generates revenue primarily through the manufacturing and sale of its engineered steel pipe products. The company's key revenue streams include contracts with municipalities, water agencies, and engineering firms involved in large-scale water infrastructure projects. The company benefits from long-term contracts and significant projects that require specialized, high-quality pipe systems. Additionally, Northwest Pipe Company may engage in strategic partnerships with construction and engineering companies to expand its market reach and secure more projects, contributing to its earnings.

Northwest Pipe Company Financial Statement Overview

Summary
Northwest Pipe Company exhibits robust financial health with steady revenue growth, improved profitability margins, and strong cash flow generation. The company's balance sheet is stable, with a prudent approach to leverage and equity management. While operational efficiency is improving, there is room for enhancement in EBIT margins and return on equity. The financial statements reflect a well-managed company with a solid financial foundation and potential for further growth.
Income Statement
80
Positive
Northwest Pipe Company shows a strong financial performance with a consistent increase in total revenue from $285.9 million in 2020 to $492.5 million in 2024, reflecting a solid revenue growth rate. The gross profit margin has also improved over time, showing efficient cost management. The net profit margin increased from 6.7% in 2020 to 6.9% in 2024, indicating profitability stability. Notably, EBIT and EBITDA margins have grown, underscoring operational efficiency. However, the EBIT margin is comparatively modest, suggesting room for improvement in operational expenses.
Balance Sheet
75
Positive
The balance sheet of Northwest Pipe Company is solid with a debt-to-equity ratio that has improved from 0.16 in 2019 to 0.35 in 2024, indicating manageable leverage. The equity ratio remains healthy at around 63.4% in 2024, showing financial stability and a strong equity base. Return on Equity (ROE) has seen fluctuations, reaching 9.1% in 2024, which is reasonable for the industry, though there is potential for higher returns. The overall trend reflects prudent financial management but suggests a need for enhanced returns on equity.
Cash Flow
85
Very Positive
The cash flow analysis reveals a remarkable improvement in free cash flow, from negative values in 2021 to positive $34.3 million in 2024, indicating strong cash generation capability. Operating cash flow consistently covers net income, with a robust operating cash flow to net income ratio, highlighting effective cash management. The free cash flow to net income ratio is favorable, suggesting efficient capital expenditure control and strong cash conversion. The consistent positive trend in cash flow metrics indicates financial resilience and effective liquidity management.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
492.55M444.36M457.67M333.31M285.91M
Gross Profit
95.41M77.64M85.86M44.25M50.52M
EBIT
48.24M33.86M27.82M2.74M12.02M
EBITDA
48.24M49.94M62.15M29.98M41.56M
Net Income Common Stockholders
34.21M21.07M31.15M11.52M19.05M
Balance SheetCash, Cash Equivalents and Short-Term Investments
5.01M4.07M3.68M3.00M37.93M
Total Assets
589.65M597.88M601.34M547.68M373.01M
Total Debt
129.88M162.94M188.63M185.19M43.70M
Net Debt
124.87M158.87M184.94M182.19M5.78M
Total Liabilities
215.65M257.52M283.07M264.30M103.39M
Stockholders Equity
374.00M340.36M318.27M283.38M269.63M
Cash FlowFree Cash Flow
34.25M35.16M-5.62M-19.07M41.74M
Operating Cash Flow
55.05M53.45M17.54M-5.81M56.09M
Investing Cash Flow
-20.74M-20.37M-23.05M-100.15M-61.43M
Financing Cash Flow
-33.38M-32.70M6.19M71.03M12.26M

Northwest Pipe Company Technical Analysis

Technical Analysis Sentiment
Negative
Last Price39.69
Price Trends
50DMA
45.57
Negative
100DMA
48.70
Negative
200DMA
44.82
Negative
Market Momentum
MACD
-1.03
Negative
RSI
41.38
Neutral
STOCH
23.59
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NWPX, the sentiment is Negative. The current price of 39.69 is below the 20-day moving average (MA) of 41.92, below the 50-day MA of 45.57, and below the 200-day MA of 44.82, indicating a bearish trend. The MACD of -1.03 indicates Negative momentum. The RSI at 41.38 is Neutral, neither overbought nor oversold. The STOCH value of 23.59 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NWPX.

Northwest Pipe Company Risk Analysis

Northwest Pipe Company disclosed 27 risk factors in its most recent earnings report. Northwest Pipe Company reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Northwest Pipe Company Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
$394.33M11.669.58%10.81%63.68%
EXEXP
72
Outperform
$7.23B15.5333.51%0.46%0.64%-1.15%
VMVMC
72
Outperform
$30.48B33.6811.79%0.81%-4.68%-1.73%
SUSUM
71
Outperform
$9.22B63.673.31%49.49%-68.49%
MLMLM
63
Neutral
$28.70B14.5322.83%0.66%-3.56%70.93%
62
Neutral
$7.25B12.393.08%3.39%3.63%-14.32%
52
Neutral
$277.45M-20.38%-7.47%-74.28%
* Industrials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NWPX
Northwest Pipe Company
39.69
5.22
15.14%
EXP
Eagle Materials
217.29
-47.89
-18.06%
MLM
Martin Marietta Materials
470.70
-147.28
-23.83%
MTRX
Matrix Service Company
10.05
-3.10
-23.57%
VMC
Vulcan Materials
230.74
-36.94
-13.80%
SUM
Summit Materials
52.49
9.79
22.93%

Northwest Pipe Company Earnings Call Summary

Earnings Call Date: Feb 26, 2025 | % Change Since: -17.35% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong financial and operational performance, including record revenue and safety achievements. However, challenges such as tariff impacts and non-residential market difficulties were discussed. The sentiment is positive due to the record accomplishments outweighing the issues faced.
Highlights
Record Financial and Operational Performance
Northwest Pipe Company achieved record net sales of $492.5 million in 2024, representing a 10.8% increase over the previous year. This was accompanied by record consolidated gross profit dollars and profitability, translating to $3.40 per share.
Record Safety Performance
The company reported a total recordable incident rate of 1.25 in 2024, underscoring its commitment to employee safety.
SPP Segment Revenue Growth
SPP segment revenue reached a record $337.9 million in 2024, up 14% year over year, driven by higher production levels and strong backlog.
Precast Segment Revenue Increase
Precast revenue increased 4.5% year over year to a new annual record of $154.6 million, despite challenges in the non-residential construction market.
Strong Free Cash Flow
The company generated free cash flow of $34 million in 2024, better than anticipated due to shifting working capital needs in the SPP business.
Lowlights
Impact of Tariffs on Gross Profit
Gross profit was negatively impacted by tariffs enacted on foreign steel, reducing profit by $0.8 million in the fourth quarter of 2024.
Challenges in Non-Residential Precast Business
The non-residential construction market faced ongoing challenges, with reduced shipments and downward pricing pressure affecting the precast business.
Steel Price Volatility
Steel prices declined throughout 2024 and then rose in 2025 to $850 per ton, impacting SPP project pricing.
Company Guidance
During the Northwest Pipe Company Fourth Quarter and Full Year 2024 Earnings Call, CEO Scott Montross highlighted the company's record performance, projecting a strong outlook for 2025. In 2024, the company achieved record annual net sales of $492.5 million, marking a 10.8% increase over the previous year, despite challenges in the non-residential precast market. The SPP segment reported a revenue of $337.9 million, an increase of 14% year-over-year, backed by a robust backlog of $310 million as of December 31, 2024. Precast revenue also reached a record $154.6 million, up 4.5% from the previous year. The company achieved a record consolidated gross profit of $95.4 million, with a gross margin of 19.4%, up from 17.5% in 2023. Looking forward, Northwest Pipe anticipates strong bidding activity in the SPP segment and a robust precast order book, with expectations for precast revenue and margins to improve or remain consistent with the first quarter of 2024. The company also reported paying down $26 million in debt and plans to continue exploring M&A opportunities to expand its precast business.

Northwest Pipe Company Corporate Events

Executive/Board ChangesShareholder Meetings
Northwest Pipe Company Approves Executive Incentive Grants
Neutral
Apr 2, 2025

On March 27, 2025, Northwest Pipe Company announced the approval of performance share units (PSUs) and restricted stock units (RSUs) for its Named Executive Officers. These long-term incentive grants are based on a percentage of the executives’ annual base salary, with PSUs vesting in three installments from 2026 to 2028, contingent on the company’s financial performance. The RSUs also vest in three installments, based on continued service. The company’s 2025 Annual Meeting of Shareholders is scheduled for June 12, 2025, with a record date of April 10, 2025.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.