Atmus Q3 sales beat expectations on Koch Filter acquisition; lifts outlook

Overview

• Filtration solutions provider's Q3 sales rose 14% yr/yr, beating analyst expectations

• Adjusted EPS for Q3 beat analyst expectations

• Company authorized new $300 mln share buyback program, replacing prior authorization

Outlook

• Atmus raises 2026 net sales outlook to $2.01 bln-$2.04 bln

• Company sees 2026 adjusted EBITDA margin between 19.75% and 20.25%

• Atmus expects 2026 adjusted EPS of $2.90-$3.05

Result Drivers

• KOCH FILTER ACQUISITION - Co said Q3 sales growth was primarily driven by the acquisition of Koch Filter, along with higher volumes, currency benefits and price increases

• GROSS MARGIN DRIVERS - Gross margin rose due to Koch Filter acquisition, higher volumes, pricing, lower one-time separation and warranty costs, partly offset by higher material and freight costs

• CASH GENERATION - Operating cash flow and adjusted free cash flow increased, helped by higher earnings and excluding one-time integration costs

Company press release: ID:nBw89j8PTa

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the auto, truck & motorcycle parts peer group is "buy"

• Wall Street's median 12-month price target for Atmus Filtration Technologies Inc. is $63.22, about 37% above its November 5 closing price of $46.16

• The stock recently traded at 14 times the next 12-month earnings vs. a P/E of 17 three months ago

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)