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Stock Buzz: ACCO Brands Corporation (NYSE: ACCO)

LAKE ZURICH, Ill., July 20, 2019 – Shares of ACCO Brands Corporation (NYSE: ACCO) lost -0.13% to $7.87. The stock grabbed the investor’s attention and traded 372.055K shares as compared to its average daily volume of 566.73K shares. The stock’s institutional ownership stands at 92.90%.

Acco Brands Corp. (ACCO) reported a first-quarter loss of $600.0K, after reporting a profit in the same period a year earlier. The Lake Zurich, Illinois-based company said it had a loss of 1 cent per share. Earnings, adjusted for non-recurring costs, came to 8 cents per share. The results surpassed Wall Street expectations. The average estimate of five analysts surveyed by Zacks Investment Research was for earnings of 5 cents per share.

First Quarter Results:

Net sales of $393.90M reduced 2.9% from the prior-year period as adverse currency reduced sales by 5.3% and acquisitions added 2.9%.  Comparable sales reduced 0.5% as lower volume offset pricing which added 2.9%.  Net loss was $0.60M, or $(0.01) per share, counting a $5.60M adjustment to tax expense related to our Brazilian tax reserve, and pre-tax charges of $3.20M for restructuring, integration and transaction expenses. Net income in the prior-year quarter was $10.40M, or $0.09 per share, which included $6.30M of charges. The decline in net income was mainly because of higher income tax expense. Adjusted net income was $8.80M, or $0.08 per share, contrast to $8.90M, or $0.08 per share, in the prior-year quarter, as improved operating performance was offset by adverse foreign currency and higher interest and income tax expenses.

Capital Allocation:

In the quarter, the company used $61.30M of net cash from operating activities and, counting capital expenditures, used $68.40M of free cash flow. The company repurchased 1.30M shares of stock for a total of $10.50M, and paid $6.20M in dividends.  The company anticipates continuing to generate strong annual cash flow, and its capital allocation priorities remain funding planned acquisitions, debt reduction, dividends and share repurchases.  The company continues to target a long-term net leverage ratio in the range of 2.0x-2.5x.

ACCO has a market value of $824.62M while its EPS was booked as $0.93 in the last 12 months. The stock has 104.78M shares outstanding. In the profitability analysis, the company has gross profit margin of 32.50% while net profit margin was 5.00%. Beta value of the company was 1.87; beta is used to measure riskiness of the security.