CMT

Image source: The Motley Fool. Tuesday, Aug. 4, 2026 at 10:00 a.m. ET President and CEO - Eric Palomaki CFO - Alex Panda Operator: Good morning, everyone. Welcome to the Core Molding Technologies Fiscal 2026 Second Quarter Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I want to now turn the call over to Sandy Martin, Three Part Advisors. Please go ahead. Sandra Martin: Good morning, everyone. Thank you for joining us for the Core Molding Technologies conference call to review our fiscal 2026 second quarter results. Joining me on the call today are the company's President and CEO, Eric Palomaki; and CFO, Alex Panda. This call is also being webcast and can be accessed through coremt.com via an audio link on the Investor Relations, Events and Presentations page. Please be advised that any time-sensitive information may no longer be accurate as of the date of any replay or transcript reading. Statements made in today's discussion that are not historical facts, including statements or expectations or future events or future financial performance are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are uncertain and outside the company's control. Actual results may differ materially from those expressed or implied, and today's earnings release includes our forward-looking disclosures. Risk factors and other uncertainties are described in detail in the company's filings with the Securities and Exchange Commission. Core Molding Technologies assumes no obligations to update or revise any forward-looking statements publicly. Management will refer to non-GAAP measures, including adjusted EPS, adjusted EBITDA, free cash flow and return on capital employed. Reconciliations to the nearest GAAP measures are available at the end of our earnings release, which has been submitted to the SEC on Form 8-K. Now I would like to turn the call over to President and CEO, Eric Palomaki. Eric? Eric Palomaki: Thank you, Sandy. Good morning, everyone. Before we cover progress on our initiatives and second quarter results, I'd like to share that Core's story is being featured this month in the American Executive Magazine. The article highlights our transformation from a turnaround story into a growing execution-driven enterprise. As we reflect on more than 30 years of operational progress in a cyclical industry, we see how the foundation we built positions us for continued success. Looking ahead, we do so with confidence, excitement and momentum as we pursue the opportunities before us. Additionally, I want to remind everyone that we are hosting an Investor Day in September. We look forward to welcoming both our long-standing shareholders and prospective investors to see firsthand the value we create every day. And yes, they'll also get a chance to look close at the scale of our operation, including some truly impressive manufacturing equipment. Now turning to our second quarter results. We delivered solid performance that reflects the continued resilience of our diversified portfolio and the ongoing execution of our Invest for Growth strategy. We continue to build on our commercial momentum, securing nearly $26 million of net wins in the first half of 2026 and remaining on track to achieve our full year objective of $50 million in additional new business awards. Over the past 2 years, we have secured more than $112 million in new business wins and a growing number of these awards are now moving into production across a number of end markets. While many of our programs have longer quote-to-cash cycles, we continue to gain traction with customers seeking our SMC compound as their proprietary advanced composite materials. Producing this raw material compound typically offers shorter commercialization time lines. To support our top line momentum and to capitalize on the growing sales pipeline, we strategically added 2 business development managers, one dedicated to the construction and agricultural markets and another focused exclusively on expanding relationships with customers seeking proprietary SMC compounds. We remain focused on broadening our presence in attractive new and addressable markets, and our team continues to identify and engage new customer opportunities every day. This year's must-win battle includes our greenfield build in Monterrey, Mexico, where construction was completed in less than 9 months, both on time and on budget. Our Monterrey facility is now in production of structural foam, structural web and DCPD products, including installed prime paint and top coat paint application systems. Turning to our facility in Matamoros, which will be on full display at our Investor Day in September. The plant expansion continues to make impressive progress and will increase our large molding capacity with 2 additional 4,500-ton machines during the second half of 2026. Importantly, our Mexico project installations and footprint optimization have not disrupted our existing operations and progress. Throughout this process, we have maintained flawless customer delivery and quality performance, demonstrating our team's ability to successfully execute significant growth initiatives without compromising operational excellence. I am incredibly proud of and grateful for our team's hard work, long hours and unwavering commitment to making this achievement possible. Together, these strategic investments totaling $25 million across our Mexico operations position us closer to our customers and align our business to capitalize on long-term growth opportunities. Operationally, our focus on disciplined execution continues to deliver results. During the quarter, we achieved 99.2% on-time delivery and a quality performance of 49 parts per million. Our quality performance was 49 ppm, meaning fewer than 50 defective parts for every 1 million parts produced. This level of performance is considered top tier within the automotive supply chain and compares favorably with the quality expectations of leading OEM customers. Simply put, more than 99.995% of the products we ship meet customer requirements. These results reflect a strong focus on repeatable operational excellence, a culture of continuous improvement and the dedication of teams across all our facilities. This operational discipline has enabled us to improve profitability, diversify our business, expand into new markets and continue investing in productivity, capacity and continuous improvement innovations. New business wins totaling nearly $26 million in the first half of 2026 continue to transform and diversify Core Molding sales profile. These awards further broaden our revenue base, reducing our exposure to historically cyclical end markets such as trucking and powersports, which improves our consistency of earnings. Importantly, 100% of our new business awards this year represent new opportunities rather than replacement programs and approximately 65% originated outside of our traditional truck and powersports markets. 74% of this business will be produced with our existing U.S. manufacturing footprint, allowing us to leverage installed capacity, improve returns on invested capital, drive profitable growth and generate stronger cash flow. As we have previously discussed, our team has secured approximately $112 million in incremental new business awards over the past 24 months, providing a clear line of sight to production revenue opportunities that could exceed $300 million in 2027. Just as importantly, many of these programs are supported by long-term customer relationships and sole-source production of highly engineered components. This gives us visibility into demand, confidence in our growth trajectory and a strong foundation for creating sustainable long-term value for our shareholders. With that, I'll now turn the call over to Alex to review the financials in more details. Alex Panda: Thank you, Eric, and good morning, everyone. For the second quarter, production sales declined 1.2% year-over-year as strong growth across powersports, building products and industrial and utilities end markets largely offset the current softness in medium and heavy-duty truck. Excluding truck, production sales across our remaining end markets increased significantly, up 20.8%, reflecting the diversification efforts Eric discussed and the strength of our commercial execution. To provide additional context, truck represented 40% of total product sales during the quarter, and this significant market declined by 23% compared with the prior year period. While truck remained a headwind to consolidated growth, we are beginning to see production volumes improve and expect sales to continue ramping through the second half of 2026. Our powersports end markets continue to perform well, generating 7% year-over-year revenue growth. Building products, while still a smaller portion of our overall portfolio, delivered exceptional growth of 36% compared with the prior year period, driven by the successful launch of previously awarded programs and increasing customer demand. We delivered meaningful gross margin of 20.3% in the second quarter, an improvement of 220 basis points compared with the prior year period. Gross margin benefited from a capacity charge received from a customer during the quarter. Excluding this item, gross margin was 19.4%, which remains at the high end of our targeted full year range of 17% to 19% and reflects the strength of our operational execution, product mix and manufacturing performance. SG&A expense was $10.4 million or 16.6% of sales. Excluding $1.8 million of Mexico expansion and succession-related expenses, SG&A was 13.8% of sales compared to 11.5% in the prior year period. These investments support our long-term growth initiatives and leadership succession planning while we continue to maintain disciplined cost management. Operating income for the quarter was $2.3 million compared to $5.2 million in the prior year period, reflecting the elevated SG&A investments discussed above. Net interest expense was $60,000 in the second quarter compared to $32,000 in the prior year quarter. During the quarter, we recognized a noncash loss of $88,000 related to the extinguishment of term loan debt and a gain of $170,000 associated with the termination of our interest rate swap. Net income was $1.8 million or $0.21 per diluted share. Adjusted EBITDA was $7.6 million, representing 12.2% of sales compared with the 12% in the prior year period. Despite the continued softness in truck, our adjusted EBITDA margin remained stable, reflecting the resiliency of our diversified portfolio and ongoing operational discipline. Net cash provided by operating activities was $7.1 million during the first half, while capital expenditures to date totaled $12.1 million, primarily related to our Mexico expansion initiatives. For full year 2026, we continue to expect capital expenditures of approximately $25 million to $30 million, with $18 million to $20 million dedicated to our strategic investments in Mexico. Our balance sheet remains a significant competitive advantage. We ended the quarter with $12.1 million in cash and no outstanding debt. In early July, we amended and extended our credit facility. The amendment increased our debt capacity to $100 million, consisting of a $50 million revolving credit facility and a $50 million delayed draw term loan, both maturing in 2031. This refinancing enhances our financial flexibility, lowers our cost of capital and provides substantial capacity to fund future organic and inorganic growth opportunities while maintaining a conservative balance sheet. Return on capital employed was 5.7% or 6.2%, excluding cash, based on trailing 12-month pretax operating income. As recently awarded programs launch, production volumes increase and asset utilization improves, we expect return on capital employed to strengthen to our long-term goal of 14%. Additional details, including GAAP to non-GAAP reconciliations are available in our earnings release. During the first half of 2026, we repurchased 24,545 shares at an average price of $18.62 per share, representing approximately $457,000 of capital return to shareholders. No shares were repurchased in the second quarter. Earlier this year, we increased our share repurchase authorization by $6.5 million and intend to continue deploying capital strategically to invest in future growth and offset share dilution. Today, we are reiterating our fiscal 2026 guidance and continue to expect the following: one, total sales to be flat to up approximately 5% year-over-year, with project-based tooling revenue weighted toward the fourth quarter; two, the majority of the $63 million new program awards secured in 2025 begin contributing meaningfully in the second half of 2026 and reach full annualized run rates during 2027; three, truck production volumes continue improving through the second half of this year; four, full year gross margin in the range of 17% to 19%, although individual quarters may fall above or below that range based on product mix, volume and timing. Regarding nonrecurring costs, Mexico expansion costs were $3.4 million through the first half of the year. And with the majority of the work now complete, we do not expect a material increase to those costs during the balance of 2026. In addition, we incurred $1.4 million of succession-related expenses through the first half and do not anticipate significant additional costs for the remainder of the year. Turning to regulatory and macroeconomic developments. While the policy environment remains dynamic, we continue to work closely with customers across North America and have not experienced any material disruption to production schedules related to ongoing USMCA discussions. Our focus remains on managing the factors within our control, and we believe our diversified manufacturing footprint, strong balance sheet and long-standing customer relationships position us well as trade policies evolve. Looking further ahead, discussions surrounding the USMCA review have increasingly centered on strengthening North American manufacturing and expanding regional sourcing. Regarding recent increases in oil prices, we maintain contractual raw material pass-through mechanisms that are expected to substantially mitigate the related cost impacts. Overall, we remain confident in our outlook, significant available capacity and a balance sheet that provides flexibility to continue investing in long-term growth. With that, I will turn the call back over to Eric. Eric Palomaki: Thank you, Alex. As we look ahead, we are increasingly aligned with some of the most compelling growth opportunities in North America. Our customers and their customers are making critical investments in utility modernization, communications infrastructure, grid resiliency and energy transition initiatives. We have secured programs supporting projects funded by the Build America, Buy America Act and other Infrastructure Investment and Jobs Act initiatives. While the ongoing expansion of high-speed broadband networks continues to create opportunities for our advanced composite solutions. During the quarter, we secured a significant award for battery energy storage systems and continue to pursue opportunities tied to accelerating power demand due in part to AI data center development, utility infrastructure modernization, grid reliability and load shedding solutions. These markets require durable, lightweight and highly engineered composite products, areas where Core has set the standard in differentiated capabilities with long-standing customer relationships. Many of these opportunities are concentrated within our industrial and utilities end markets, where we continue to scale adoption of our proprietary SMC technologies. We are particularly encouraged when customers design our proprietary components and materials into their branded products serving both consumers and critical infrastructure markets. Once engineered into an application, our solution often becomes integral to the performance and value proposition of the end product, creating long-term customer relationships and opportunities to partner and grow alongside them. Our powersports and utilities markets provide strong examples of this strategy in action. In powersports, our OEM customers incorporate proprietary advanced composite materials into their watercraft, where durability, lightweighting and performance are important differentiators for consumers. These attributes help our customers strengthen their brands and distinguish their products in highly competitive markets. In utilities and industrial applications, customers increasingly utilize composite solutions as an alternative to traditional materials such as concrete. The benefits include enhanced durability, lower transportation and installation costs, reduced storage requirements and improved worker safety. For example, composite enclosures for underground transmission can often be installed by 2 technicians without a crane, simplifying deployment while reducing the risk of injury. Equally important, these products are increasingly being marketed around sustainability and performance benefits, including long-term resistance to chemicals, water and shipping. Whether serving retail customers or supporting large-scale infrastructure and hyperscale construction projects, these applications demonstrate how our proprietary materials create value for customers while expanding our opportunities for long-term growth. As Alex discussed on building products, we secured significant customer wins in 2025 that have now entered production and are generating revenue. We win programs well before revenue is realized as design, tooling, validation testing and production launch occur over multiple phases. Our building products revenue in the second quarter grew more than 35% year-over-year, reflecting the successful conversion of commercial efforts into meaningful revenue and earnings growth. At the same time, we are beginning to see improved demand trends in the truck market and expect production volumes to continue to strengthen through 2026 and are forecasted to increase into 2028. Combined with the growth of our newer end markets, these activities create a broader and more balanced platform for future performance. Looking ahead, we remain confident in the long-term strength of our business and the significant opportunities ahead. Our disciplined capital allocation strategy continues to balance investment in organic growth initiatives with a thoughtful approach to acquisitions that can enhance our scale, capabilities and market reach. While we are broadening our evaluation of potential M&A opportunities, including larger transactions, our financial and strategic criteria remain unchanged. We are committed to pursuing opportunities that are accretive, strategically aligned and capable of creating long-term shareholder value. Supported by a motivated commercial organization, a strong operational foundation and our reputation as a trusted partner, delivering comprehensive design, fabrication and finished assembled solutions, we continue to make progress towards our long-term revenue objective of $500 million. At the same time, we remain focused on profitability, cash flow generation, return on capital employed and serving customers across attractive end markets, including truck, powersports, construction, energy, industrial, aerospace and medical. I want to thank our dedicated employees for their hard work, commitment and unwavering focus on excellence. We are celebrating our 30-year anniversary this year. After 3 decades of continuous operations, we know that people are our greatest competitive advantage and the driving force behind our success. I also want to thank our customers, shareholders and Board for their continued confidence and support as we execute our long-term strategy. Before I close, I want to mention our upcoming Investor Day and plant tour in Brownsville, Texas on September 29 and 30. I'm excited for investors to see firsthand what makes Core unique, our people, our culture, our manufacturing capabilities and the operational discipline that drives our performance. We have received tremendous interest and already have a strong group of investors registered. Capacity is limited, but a small number of openings remain, and we would welcome the opportunity to showcase our business to anyone interested in learning more about our long-term value creation story. With that, we'll open the line for questions. Operator? Operator: [Operator Instructions] Our first question today is from Chip Moore with ROTH MKM. Alfred Moore: I wanted to ask on trucking. It sounds like you're starting to see some encouraging signs and you expect that to continue here in the back half. Just maybe you can expand on that and provide a little color on sort of what you're seeing and what your expectations are for go-forward? Eric Palomaki: Yes, sure. On the truck side, certainly, the first half would have been on the lower side for us, and we see that recovering second half of this year. And if you go to industry forecasts, that's over the next 2.5 years, we'll continue to see increases. And so both from, I would say, very specifically from that forecasting and industry knowledge perspective, we see that increasing as well as in the order books and the day-to-day action that's happening today. We see that across all of our truck customers. The second half will be stronger. Alfred Moore: Okay. Good to hear. And maybe on the flip side, right, the momentum in non-trucking, non-powersports, you called out some wins there and how you're broadening and diversifying. Just any more color around some of those markets, how they're trending? And what's the opportunity over the next couple of years? Eric Palomaki: Yes, I'll touch on some of the new wins, and then I'll let Alex touch on the quarter-over-quarter and improvements in some of those other industries. On the new wins, we're up to $25 million, $25.8 million, just shy of $26 million for the first half. And those are -- I think I mentioned in the script, 65% of those are outside of what we call the traditional truck and powersports business or new industries. Some of those are in the utilities market where we're trying to move underground data cables infrastructure networking, things like that into neighborhoods residentials, moving all of this data that has got to be transmitted to AI data centers and all of the modernization of those Internet connections, all of those need to interconnect boxes. And so we have had a number of years now of success. And again, this quarter, another customer that's trusting us with our composite solution. It's a better replacement than concrete. It's lighter. 2 people can put it in without a crane. You don't have any kind of corrosion or cracking problems like you do with wood or wood rotting or metals corroding. So the composite solution we have provides a good structure as well as a lighter product that's easier to install. And so it's really kind of taking off with multiple customers that are building composite solutions for anything that requires underground data cables being buried. On top of that, we had another SMC compound win this quarter, and that one is inside the trucking business. So we're excited for that one as well as an electric vehicle tailgate cover that we also won this quarter. So a number of good products, some of them inside that traditional business, sometimes some of them outside, but we'll continue to grow those and diversify. And finally, I want to add, Chip, you'll remember that we always try to use the assets we have. And so 74% of it being on our U.S. facilities that have existing presses where we don't need to buy or make a large capital investment. We just run those products on an existing asset is a very good win for us this year. So we're excited about that metric. Alex Panda: Yes. And I think the growth -- it's exciting to see the wins that we've talked about over the last couple of years are starting to come through on the P&L, right? You have powersports year-over-year. We have the skid plates launch that launched in Q3 of the previous year. So year-over-year, that's an increase. Then also in building products, the door skins that we launched in Q2 -- the end of Q2 of last year, we get a full quarter this year. And so you see an increase in building products. And then the last one I'll mention is in the other category, automotive, we've run an automotive program for a while now, and we saw some pretty significant increases on that program in Q2. So that was just a demand increase. Alfred Moore: Got it. Very helpful and good to hear great color. And maybe just my last one, guys, just around, I think you called out M&A scope sort of broadening or maybe even looking at some larger stuff out there. Just walk us through what you're thinking about on the acquisition front. Eric Palomaki: Yes. Alex and I have had the chance to visit a number of opportunities already. We're averaging about 1 a month, and some of those have been smaller in scale than what we've looked at and some of them been a little bit larger in scale. But really, the focus isn't necessarily on specifically the size, it's how it can be accretive, how it can add diversification to our portfolio, how we can make it a very good return on capital employed opportunity that fits with Core Molding. I think that's the most important thing is that we stay disciplined to something that fits our culture, our processes, our sort of DNA. Operator: [Operator Instructions] The next question is from Bill Dezellem with Tieton Capital. William Dezellem: A couple of questions. First of all, relative to the growth that you've experienced this quarter and in the first half, and I'd like you to tie that back to the year ago Q2 having nearly $18 million of tooling. Is that or was that a leading indicator for this growth? Or are they really unrelated in this case? Alex Panda: Yes. So, Bill, thanks for the question. So in this specific case, no, they are not connected. The large tooling project that we closed in Q2 of last year and in Q4 of last year related to an international truck job. That job will be launching here in the beginning of 2027, and it's a replacement program. And so, I would say, normally, yes, right? If we're recognizing revenue -- tooling revenue, project revenue that product sales revenue will follow. In this case, though, specifically, they're not connected. William Dezellem: Okay. That's helpful. And maybe you can use this to educate me what would be the normal lag in time between the tooling revenue and having production revenue if it were a normal circumstance and not this one that we're talking about here. Eric Palomaki: Yes. Bill, I would say, on average, it's 12 to 24 months. That's a pretty big range for you. But even a big program like the one Alex just talked about, an international truck program, that's probably close to a year delayed as far as the truck launch. So we've been ready as far as we being a Tier 1 supplier, a key Tier 1 to the truck OEM. But if they're not ready with all of their suppliers and don't launch the vehicle, in this case, it's not a big impact to revenue for us because it's replacement. So we would -- we just keep building the old vehicle. But as they transition to the new ones, there's a lot of great quality improvements and operational improvements that come along with that transition. So we're looking forward to that launch coming up at the end of this year to early next year. When we talk about that lag, it's why we sometimes note about SMC compounds, we're finding that we can get all of that testing and validation done in the 6-month range. We have done -- we're doing 1 tooling project for, call it, more of a molded ship. There's no assembly, no complicated add-ons, and we're doing that in about 7 months, 6 to 7 months. So we've had a few wins that we've gotten well under that 12 months. But when you think of the bigger assembled products, a hood, a roof, watercraft, they're all in the 12 to 24 months from that point of tooling to the point of production revenues and product, what we would call product revenues. William Dezellem: That's very helpful. And then you talked a little bit about the truck market and that the anticipation with -- from an industry perspective is that, there will be growth over the next, say, 2.5 years. Would you please tie that into the current new regulations that are or are not coming in? And just what are the moving pieces here? And how do you see that regulatory environment affecting the moves to new models? Eric Palomaki: Yes. So truck market recovering second half of this year or improving. Exactly how much that will grow will yet to be determined in the second half, but definitely seeing the second half stronger than the first half. The industry predicts annual volumes for the next 5 years, and they see the next 2.5 years of continued growth of both Class 8 and medium-duty trucks. You do touch correctly on the wildcard that is out there that maybe none of us know what that wildcard is exactly going to be if somebody changes it, but January 1 of '27, so 5 months away, 6 months away from now, the emissions regulations do change, and that will require powertrain differences for all of the OEMs. So that added cost or added price on a sale of a truck could create a, I would call, short-term quarter-over-quarter impact to volume, but likely not change that overall annual trend over the next 2.5 to 3 years. There's lots of conversations out in the industry about whether that emissions regulation will have slight changes to it, tweaks to it. It likely won't change drastically, but it could change its timing, could change some of the details around it. We don't have any formal insight on to exactly what that is. But as of right now, it goes into effect January 1, '27. Alex Panda: And even if they were to roll back some of the standards, the hardware changes are already done in the design. The OEMs won't be changing any hardware because of it. William Dezellem: That's helpful. And not to get too granular here, but is -- do the regulations apply to trucks produced after January 1, ordered after January 1 or delivered? What's actually the cutoff? And where I'm going with this is, is there currently, given the regulations potentially being in flux and the rumors out there, does that create an incentive for the buyers literally to wait as late in December as possible, place their order and then we see volume from Core's perspective increasing in the first half of next year. What's the reality? Eric Palomaki: That's a great question. And I will tell you what I think to be the case, Bill, but important that somebody validate this. I think it is when they issue the VIN number onto the engine, not even just the chassis. So it's finishing of the engine is where I think the emissions reg happens. So that has to -- when that is produced, relative to December 31 or January 1. So you can still deliver that truck that was built December 15, you can deliver that 2 months later or have it set at a dealership or something like that. It still qualifies as a 2026 emissions regulation versus if it was built, the block stamp and finish the engine into '27. So that was one of your questions. As far as overall, some of those industry forecasts try to predict how much prebuy is the term given to it. So are you waiting for the last of the year to place your order? Are you willing to take orders earlier? What happens is the build slots start to fill up and that will force a buyer into ordering a truck even as early as November or October or back into September. And so there could be some of that, that's creating some of the increase in run rates right now today that people are actually starting to build more trucks in August right now because of those build slots filling up at the end of the year. William Dezellem: And apologies for taking a little extra time here. But if we heard you correctly and if your understanding is correct, that the incentive then would be for the manufacturers to produce as many trucks as possible prior to December 31, have that VIN number on the engine, and at that point, you have a 2026 model year. And then they can actually either sell that truck next year at a lower price or they could actually take some higher margin with basically an umbrella pricing under the '27 regs. Are we thinking about that right? Eric Palomaki: Yes. I would tell you there is data that on the prior emissions changes suggest exactly what you just suggested. That behavior exists and has existed in the past. So we would anticipate it to happen again on this emissions change. Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Eric Palomaki for any closing remarks. Eric Palomaki: Thank you for your continued interest in our company. We look forward to providing an update on our progress when we report our third quarter results in a few months. Have a great day. Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect. 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Interested in Core Molding Technologies Inc? Here are five stocks we like better. Second-quarter production sales fell 1.2% year over year as a 23% decline in truck-related sales offset strong growth in other markets, including building products (+36%) and powersports (+7%). Management expects truck sales to improve in the second half and reiterated its full-year sales outlook of flat to approximately 5% growth. Gross margin improved to 20.3%, while adjusted EBITDA margin held at 12.2% despite truck-market weakness. Operating income declined to $2.3 million from $5.2 million, and net income was $1.8 million, or $0.21 per diluted share. Growth investments and new awards remain key catalysts: Mexico expansion spending is expected to support added capacity, while nearly $26 million in new business wins during the first half keeps the company on track for its $50 million annual target. Management said awards secured over the past 24 months could generate more than $300 million in production revenue opportunities by 2027. 3 Small-Cap Stocks to Buy as the Russell 2000 Extends Its Rally Core Molding Technologies (NYSEAMERICAN:CMT) reported fiscal 2026 second-quarter production sales that declined 1.2% year over year as continued weakness in the medium- and heavy-duty truck market offset growth in several other end markets. Management reiterated its full-year outlook, including expectations for sales ranging from flat to up approximately 5%. President and CEO Eric Palomaki said the company’s diversified portfolio and its Invest for Growth strategy supported the quarter’s performance. Excluding truck-related sales, production sales across the company’s other end markets rose 20.8% from the prior-year period, according to CFO Alex Panda. → No Hangover: Revisiting Microsoft One Week After Earnings Truck represented 40% of Core Molding’s total product sales during the quarter and declined 23% year over year. Panda said the company is beginning to see truck production volumes improve and expects sales to ramp through the second half of fiscal 2026. Palomaki told analysts that the company sees stronger activity in customer order books and expects the second half to be stronger than the first half across its truck customers. He also cited industry forecasts calling for continued growth in Class 8 and medium-duty truck production over the next two-and-a-half years. → MarketBeat Week in Review – 08/03 - 08/07 Management noted uncertainty around emissions regulations scheduled to take effect Jan. 1, 2027. Palomaki said potential changes in regulations could affect the timing of truck purchases, although he said the company expects the broader annual truck-production trend to remain intact. Panda added that truck original equipment manufacturers have already completed hardware design changes associated with the standards. Outside of trucking, powersports revenue increased 7% year over year, while building-products revenue rose 36%, supported by the launch of previously awarded programs and customer demand. Panda also cited increased demand for an existing automotive program during the quarter. → Why the Landlord of the AI Boom Could Outlast the Chipmakers Core Molding reported gross margin of 20.3%, up 220 basis points from the year-earlier quarter. The figure included a capacity charge received from a customer. Excluding that item, gross margin was 19.4%, near the high end of the company’s stated full-year target range of 17% to 19%. SG&A expense totaled $10.4 million, or 16.6% of sales. Excluding $1.8 million in Mexico expansion and succession-related costs, SG&A represented 13.8% of sales, compared with 11.5% in the prior-year period. Operating income was $2.3 million, compared with $5.2 million a year earlier. Net income was $1.8 million, or $0.21 per diluted share. Adjusted EBITDA was $7.6 million, or 12.2% of sales, compared with 12% of sales in the prior-year quarter. Net cash provided by operating activities was $7.1 million in the first half of fiscal 2026. Panda said the stable adjusted EBITDA margin despite truck-market softness reflected the company’s portfolio diversification and manufacturing discipline. The company is investing in manufacturing capacity in Mexico, including a new facility in Monterrey and an expansion in Matamoros. Palomaki said construction of the Monterrey greenfield facility was completed in less than nine months, on time and on budget. The site is now producing structural foam, structural web and DCPD products and includes paint application systems. The Matamoros expansion is expected to add two 4,500-ton molding machines during the second half of 2026. The company said its Mexico investments total $25 million and are intended to increase capacity and position production closer to customers. Panda said capital expenditures are expected to total approximately $25 million to $30 million for the full year, including $18 million to $20 million for Mexico initiatives. Mexico expansion costs totaled $3.4 million through the first half, and management does not expect a material increase during the remainder of the year. The company also incurred $1.4 million in succession-related expenses in the first half and does not anticipate significant additional costs in 2026. Core Molding secured nearly $26 million of net new business wins in the first half and remains on track for its $50 million full-year target. Palomaki said 100% of the awards represent new opportunities rather than replacement programs, with approximately 65% coming from outside the company’s traditional truck and powersports markets. About 74% of the newly awarded business is expected to use existing U.S. manufacturing capacity. Over the past 24 months, the company has secured approximately $112 million in incremental business awards. Management said those awards could provide production revenue opportunities exceeding $300 million in 2027 as programs enter production. Core Molding ended the quarter with $12.1 million in cash and no outstanding debt. In early July, the company amended and extended its credit facility, increasing total debt capacity to $100 million through a $50 million revolving credit facility and a $50 million delayed-draw term loan, both maturing in 2031. During the first half, the company repurchased 24,545 shares for approximately $457,000, at an average price of $18.62 per share. No shares were repurchased in the second quarter. Management reiterated that it expects the majority of the $63 million in new program awards secured during 2025 to begin contributing meaningfully in the second half of 2026 and reach full annualized production rates in 2027. The company also expects project-based tooling revenue to be weighted toward the fourth quarter. Palomaki said the company is evaluating acquisition opportunities of varying sizes but remains focused on transactions that are accretive, strategically aligned and supportive of returns on capital. Core Molding will host an Investor Day and plant tour in Brownsville, Texas, on Sept. 29 and 30. Core Molding Technologies is a publicly traded manufacturer specializing in engineered composite and polymer solutions for a wide array of industrial applications. The company's core business includes the design, tooling and high-volume production of fiberglass-reinforced plastics, advanced polyurethane systems, structural composites and specialty coatings. Its products find use in commercial vehicles, off-highway equipment, defense, power sports, recreation and industrial markets. Core Molding offers end-to-end services ranging from digital design and prototyping to mold fabrication, process development and full-scale manufacturing. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Core Molding Technologies Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Core Molding Technologies (CMT) came out with quarterly earnings of $0.21 per share, in line with the Zacks Consensus Estimate . This compares to earnings of $0.47 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this maker of fiber reinforced plastics would post earnings of $0.22 per share when it actually produced earnings of $0.07, delivering a surprise of -68.18%. Over the last four quarters, the company has surpassed consensus EPS estimates just once. Core Molding Technologies, which belongs to the Zacks Rubber - Plastics industry, posted revenues of $62.73 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 4.46%. This compares to year-ago revenues of $79.24 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Core Molding Technologies shares have added about 19.7% since the beginning of the year versus the S&P 500's gain of 11%. While Core Molding Technologies has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Core Molding Technologies was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.39 on $63.14 million in revenues for the coming quarter and $1.07 on $283.12 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Rubber - Plastics is currently in the top 42% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the broader Zacks Industrial Products sector, SoundThinking (SSTI), has yet to report results for the quarter ended June 2026. This maker of gunfire detection systems is expected to post quarterly loss of $0.27 per share in its upcoming report, which represents a year-over-year change of -12.5%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. SoundThinking's revenues are expected to be $25.89 million, down 0% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Molding Technologies Inc (CMT) : Free Stock Analysis Report SoundThinking, Inc. (SSTI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Secured $26 million in net new business wins during the first half of 2026, tracking toward a full-year goal of $50 million. Successfully diversified the revenue base, with 65% of new awards originating outside traditional truck and powersports markets to mitigate cyclicality. Completed construction of the Monterrey, Mexico greenfield facility on time and on budget, expanding structural foam and paint capabilities. Leveraged existing U.S. manufacturing assets for 74% of new business, optimizing returns on invested capital without requiring major new equipment. Maintained top-tier quality performance of 49 parts per million, aligning with rigorous automotive supply chain standards. Strategic focus on proprietary SMC compounds is shortening commercialization timelines compared to traditional long-cycle molded programs. Attributed 20.8% growth in non-truck end markets to successful commercial execution and the launch of previously awarded programs. Reiterated fiscal 2026 guidance of flat to 5% sales growth, with project-based tooling revenue expected to be weighted toward the fourth quarter. Anticipates production revenue opportunities could exceed $300 million in 2027 as $112 million in recent awards reach full run rates. Expects medium and heavy-duty truck production volumes to ramp through the second half of 2026 and continue increasing through 2028. Targeting a long-term return on capital employed (ROCE) of 14% as asset utilization improves and new programs launch. Projecting full-year capital expenditures of $25 million to $30 million, with up to $20 million dedicated to Mexico strategic investments. Amended credit facility to $100 million capacity, providing significant flexibility for potential organic growth and larger M&A transactions. Incurred $3.4 million in Mexico expansion costs and $1.4 million in succession-related expenses during the first half of the year. Maintained contractual raw material pass-through mechanisms to mitigate the impact of recent increases in oil prices. Reported no outstanding debt at quarter-end, positioning the balance sheet as a competitive advantage for future acquisitions. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed the second half of 2026 will be stronger than the first half based on current order books and industry forecasts. Industry data suggests a 2.5-year growth cycle for Class 8 and medium-duty trucks despite upcoming emissions regulation changes. Significant traction in the utilities market for underground data cable infrastructure, where composites are replacing traditional concrete and wood. Secured a significant award for battery energy storage systems and is pursuing further opportunities in AI data center development, where lightweight and durable material properties are key differentiators. Management anticipates a potential 'pre-buy' behavior where customers fill build slots in late 2026 to avoid higher costs of 2027 compliant engines. Clarified that emissions regulations typically apply to the engine's manufacture date (VIN issuance) rather than the final truck delivery date. The company is averaging one site visit per month and is broadening its scope to include larger potential transactions. Strategic focus remains on deals that are accretive, culturally aligned, and offer strong returns on capital employed.

First-Half New Business Wins of $25.7 million Expand Market Diversification and Reinforce Full-Year Invest for Growth Expectations COLUMBUS, Ohio, Aug. 04, 2026 (GLOBE NEWSWIRE) -- Core Molding Technologies, Inc. (NYSE American: CMT) (“Core Molding”, “Core” or the “Company”), a leading engineered materials company specializing in molded structural products, principally in medium- and heavy-duty truck, powersports, building products, and industrial and utilities industries across the United States, Canada and Mexico today reports financial and operating results for the fiscal periods ended June 30, 2026. Eric Palomaki, the Company’s President and Chief Executive Officer, said, “Our second quarter results reflect the resilience of our diversified portfolio and the continued execution of our Invest for Growth strategy.   As expected, production sales in our medium- and heavy-duty truck markets remained soft; however, strong momentum across our powersports, building products, and industrial and utilities end markets mostly offset that weakness.   While tooling revenue remains all project-driven with larger customer acceptances anticipated in the fourth quarter, our commercial execution continues to gain traction.   We are pleased with the nearly $26 million in new business awards we secured during the first half of 2026, which further diversify our revenue base and reduce our reliance on historically cyclical end markets. Importantly, 100% of these awards represent net new business rather than replacement volume, and approximately 65% originated from markets outside of our traditional truck and powersports sectors. 74% of this new business will be produced within our U.S. manufacturing footprint, allowing us to leverage installed capacity, improve returns on invested capital, drive profitable growth, and generate stronger cash flow. We are also expanding our presence in compelling secular growth markets.   During the quarter, we secured a significant award for battery energy storage systems and continue to pursue opportunities tied to accelerating power demand needed for grid reliability which is impacted by AI data center development, utility infrastructure modernization, and load-shedding solutions. “In parallel with these initiatives, our 2026 Must Win Battle is transforming our operating footprint and strengthening our competitive position in Mexico.   This year, we will quadruple our manufacturing footprint in Monterrey, adding two 4500-ton presses in Matamoros, and advancing a culture of operational excellence that continues to deliver measurable results. I am especially proud of our Mexico team, whose execution enabled the successful completion of a major plant relocation and consolidation in less than nine months all while maintaining excellent on time shipping and quality metrics. These investments reflect our disciplined approach to capital allocation and our commitment to organic growth.   By expanding capacity, we are building a scalable platform that supports secured and future programs, accelerates profitable growth, and enhances long-term shareholder value." Alex Panda, the Company’s EVP and Chief Financial Officer, said, “For the second quarter, total product or production sales declined 1.2% year over year, as strong growth across powersports, building products, and industrial and utilities end markets largely offset lower truck demand.    Production sales, excluding the truck end market, increased 20.8% year over year. This quarter, we again delivered a strong profitability as gross margin was 20.3% of sales. For 2026, we continue to expect total net sales in the flat-to-approximately 5% growth range, including production revenue and tooling project revenue.   We continue to anticipate a gradual recovery in the truck market during the second half of the year.   Our gross margin projections remain in the 17% to 19% range, depending on end market product mix and the split between production revenues and tooling project revenues. “Our balance sheet remains strong.   During the quarter, we repaid the remaining balance on our 2022 Term Loan, and in July 2026, we successfully amended and extended our credit facilities, further strengthening our financial position. The amended credit agreement provides a $50 million revolving credit facility and a $50 million delayed-draw term loan facility, both maturing in July 2031.   During the quarter, we also terminated our interest rate swap agreement, generating a small gain and simplifying our capital structure.   With ample liquidity, enhanced financial flexibility, and a disciplined approach to capital allocation, we remain well positioned to execute our ‘Invest for Growth' strategy and support our long-term growth objectives.” Second Quarter 2026 Highlights Total net revenues comprised Production revenues of $60.9 million and Tooling Project revenue of $1.8 million. Gross margin of $12.7 million, or 20.3% of net revenues, compared to 18.1% of net sales in the prior year second quarter. The improvement was primarily the result of a favorable product mix and operating efficiencies, as well as a one-time margin benefit from a customer capacity credit. Excluding the 2026 one-time credit, gross margin was 19.4%. Selling, general, and administrative expenses of $10.4 million, or 16.6% of net revenues, compared to $9.1 million, or 11.5% of net revenues in the prior year second quarter. Operating income of $2.3 million, or 3.7% of net revenues, which includes non-recurring costs above, compared to operating income of $5.2 million, or 6.6% of net revenues for the prior year second quarter. Net income of $1.8 million, or $0.21 per diluted share, compared to net income of $4.1 million, or $0.47 per diluted share for the prior year second quarter. Adjusted net income1 of $3.3 million, or $0.39 per diluted share. Adjusted EBITDA1 of $7.6 million, or 12.2% of net revenues, compared to $9.5 million, or 12.0% for the prior year second quarter. Six-Month 2026 Highlights Total net revenues comprised Production revenue of $118.4 million and Tooling Project revenue of $3.0 million. Gross margin of $24.7 million, or 20.4% of net revenues, compared to 18.5% of net revenues in the prior year six-month period. Selling, general, and administrative expenses of $21.6 million, or 17.8% of net revenues, compared to $18.0 million, or 12.8% of net revenues. Operating income of $3.1 million, or 2.5% of net revenues, which includes non-recurring costs above, compared to operating income of $8.1 million, or 5.7% of net revenues for the prior year six-month period. Net income of $2.4 million, or $0.27 per diluted share, compared to net income of $6.2 million, or $0.72 per diluted share for the prior year six-month period. Adjusted net income1 of $6.5 million, or $0.74 per diluted share. Adjusted EBITDA1 of $15.0 million, or 12.3% of net revenue, compared to $16.7 million, or 11.9% for the prior year six-month period. 24,545 shares repurchased under the share repurchase authorization at an average price of $18.62, totaling $457,000. 1Adjusted Net Income and Adjusted EBITDA are non-GAAP financial measures as defined and reconciled 2026 Capital Expenditures The Company’s capital expenditures for the first six months of 2026 were $12.1 million, including $9.6 million related to the Company's Mexico expansion project. For the full year 2026, the Company expects capital spending of approximately $25 to $30 million, including $18 million to $20 million allocated to the Mexico expansion. The Company generated a Return on Capital Employed1 of 5.7% for the trailing twelve months and 6.2% excluding cash. Financial Position at June 30, 2026 The Company’s cash at June 30, 2026, was $12.1 million. As of June 30, 2026, the Company repaid in full the outstanding balance of the Huntington Term Loan. Subsequent to the quarter, on July 2, 2026, the Company entered into the third amendment of its 2022 Credit Agreement. This amendment refinanced the Company's existing term loan and credit facilities. The Company has secured credit facilities in an aggregate principal amount of $100 million, consisting of a $50 million revolving credit facility and a $50 million delayed draw term loan facility at favorable rates compared to the 2022 Credit Agreement.   As of June 30, 2026, the Company repaid in full the outstanding Term Loan balance from the 2022 Credit Agreement. Conference Call The Company will conduct a conference call today at 10:00 a.m. Eastern Time to discuss financial and operating results for the periods ended June 30, 2026. To access the call live by phone, dial (844) 881-0134 and ask for the Core Molding Technologies call at least 10 minutes prior to the start time. A telephonic replay will be available through August 11, 2026, by calling (855) 669-9658 and using passcode ID: 6843258#. A webcast of the call will also be available live and for later replay on the Company’s Investor Relations website at www.coremt.com/investor-relations/events-presentations/. About Core Molding Technologies, Inc. Core Molding Technologies is a leading engineered materials company specializing in molded structural products, principally in building products, utilities, transportation and powersports industries across North America. The Company operates in one operating segment as a molder of thermoplastic and thermoset structural products. The Company’s operating segment consists of one reporting unit, Core Molding Technologies. The Company offers customers a wide range of manufacturing processes to fit various program volume and investment requirements. These thermoset processes include compression molding of sheet molding compound (“SMC”), resin transfer molding (“RTM”), liquid molding of dicyclopentadiene (“DCPD”), spray-up and hand-lay-up. The thermoplastic processes include direct long-fiber thermoplastics (“DLFT”) and structural foam and structural web injection molding. Core Molding Technologies serves a wide variety of markets, including the medium and heavy-duty truck, marine, automotive, agriculture, construction, and other commercial products. The demand for Core Molding Technologies’ products is affected by economic conditions in the United States, Mexico, and Canada. Core Molding Technologies’ operations may change proportionately more than revenues from operations. Cautionary Note Regarding Forward-Looking Statements This press release contains forward-looking statements within the meaning of the federal securities laws that are subject to risks and uncertainties. These statements often include words such as “believe”, “anticipate”, “plan”, “expect”, “intend”, “will”, “should”, “could”, “would”, “project”, “continue”, “likely”, and similar expressions. In particular, this press release may contain forward-looking statements about the Company’s expectations for future periods with respect to its plans to improve financial results, the future of the Company’s end markets. Factors that could cause actual results to differ from those reflected in forward-looking statements relating to our operations and business include: dependence on certain major customers, and potential loss of any major customer due to completion of existing production programs or otherwise; business conditions in the plastics, transportation, power sports, utilities and commercial product industries (including changes in demand for production); the availability and price increases of raw materials; general macroeconomic, social, regulatory and political conditions, including uncertainties surrounding volatility in financial markets; the imposition of new or increased tariffs and the resulting consequences; safety and security conditions in Mexico; costs and other resources related to Core Molding Technologies’ efforts to expand its customer base and grow its business, and provide on-time delivery to customers; the Company’s decision to pursue new products and initiatives to quote and execute manufacturing processes for new business, acquire raw materials, address inflationary pressures, regulatory matters and labor relations; the ability to successfully identify, evaluate and manage potential acquisitions and to benefit from and properly integrate any completed acquisitions; the Company’s financial position or other financial information; inadequate insurance coverage to protect against potential hazards; equipment and machinery failure; product liability and warranty claims; cybersecurity incidents or other similar disruptions; and other risks and uncertainties described in the Company’s filings with the SEC. These statements are based on certain assumptions that the Company has made in light of its experience as well as its perspective on historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances. Actual results may differ materially from the anticipated results because of certain risks and uncertainties, including those included in the Company’s filings with the SEC. There can be no assurance that statements made in this press release relating to future events will be achieved. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on behalf of the Company are expressly qualified in their entirety by such cautionary statements. Company Contact:Core Molding Technologies, Inc.Alex PandaExecutive Vice President & Chief Financial [email protected] Investor Relations Contact:Three Part Advisors, LLCSandy Martin or Steven [email protected], [email protected] Non-GAAP Financial Measures This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Core Molding management uses non-GAAP measures in its analysis of the Company's performance. Investors are encouraged to review the reconciliation of non-GAAP financial measures to the comparable GAAP results available in the accompanying tables. Reconciliation of Non-GAAP Financial Measures Adjusted EBITDA represents net income before, as applicable from time to time, (i) interest expense, net, (ii) provision (benefit) for income taxes, (iii) depreciation and amortization of long-lived assets, (iv) share based compensation expense, (v) restructuring and severance costs, and (vi) nonrecurring legal settlement costs and associated legal expenses unrelated to the Company's core operations. Debt-to-trailing twelve months adjusted EBITDA represents total outstanding debt divided by trailing twelve months Adjusted EBITDA. Free Cash Flow represents net cash (used in) provided by operating activities less purchase of property, plant and equipment. Trailing twelve months return on capital employed represents the trailing twelve months earnings before (i) interest expense, net and (ii) provision (benefit) for income taxes divided by (i) stockholders' equity and (ii) current and long-term debt. Adjusted Net Income represents net income before severance cost (net of tax). We present Adjusted EBITDA, Adjusted EBITDA as a percent of net revenue , Free Cash Flow and trailing twelve months Return on Capital Employed because management uses these measures as key performance indicators, and we believe that securities analysts, investors and others use these measures to evaluate companies in our industry. These measures have limitations as analytical tools and should not be considered in isolation or as an alternative to performance measure derived in accordance with GAAP as an indicator of our operating performance. Our calculation of these measures may not be comparable to similarly named measures reported by other companies. The following tables present reconciliations of net income to Adjusted EBITDA, and Cash Flow from Operating Activities to Free Cash Flow, the most directly comparable GAAP measures, and trailing twelve months Return on Capital Employed, for the periods presented:

This article first appeared on GuruFocus. Production Sales: Declined 1.2% year over year in Q2 2026. Ex-Truck Sales: Increased 20.8% year over year. Truck Sales: Represented 40% of total product sales, down 23% year over year. Power Sports Revenue: Grew 7% year over year. Building Products Revenue: Grew 36% year over year. Gross Margin: 20.3% in Q2, up 220 basis points year over year; 19.4% excluding a capacity charge. SG&A Expense: $10.4 million, or 16.6% of sales; 13.8% of sales excluding $1.8 million in Mexico expansion and succession-related expenses. Operating Income: $2.3 million, compared to $5.2 million in the prior year period. Net Income: $1.8 million, or $0.21 per diluted share. Adjusted EBITDA: $7.6 million, representing 12.2% of sales. Operating Cash Flow: $7.1 million in the first half of 2026. Capital Expenditures: $12.1 million year-to-date; full-year guidance of $25 million to $30 million. Cash Position: $12.1 million in cash with no outstanding debt. Return on Capital Employed: 5.7%, or 6.2% excluding cash. Share Repurchases: 24,545 shares repurchased in H1 2026 at an average price of $18.62, totaling approximately $457,000. Warning! GuruFocus has detected 2 Warning Signs with CMT. Is CMT fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Core Molding Technologies Inc (CMT) secured nearly $26 million in net new business wins in the first half of 2026, with 100% representing new opportunities and 65% originating outside of traditional truck and power sports markets. The company's diversification strategy is yielding results, with non-truck end markets growing 20.8% year-over-year, including a 36% surge in building products and 7% growth in power sports. Operational excellence remains a key strength, with a 99.2% on-time delivery rate and a top-tier quality performance of 49 parts per million (PPM), exceeding typical OEM expectations. The Greenfield facility in Monterrey, Mexico, was completed on time and on budget in under 9 months and is now in production, while the Matamoros expansion is on track to add two 4,500-ton machines in the second half of 2026. The company maintains a strong balance sheet with $12.1 million in cash and no outstanding debt, and has amended its credit facility to increase debt capacity to $100 million, providing substantial flexibility for future growth and M&A. Gross margin improved to 20.3% in Q2, up 220 basis points year-over-year, and adjusted EBITDA margin remained stable at 12.2% despite softness in the truck market. Core Molding Technologies Inc (CMT) is capitalizing on secular growth trends, including securing a significant award for battery energy storage systems and benefiting from infrastructure investments tied to the Build America Buy America Act and AI data center development. The company is seeing early signs of a truck market recovery, with production volumes expected to ramp through the second half of 2026 and industry forecasts predicting growth into 2028. Production sales declined 1.2% year-over-year in Q2, primarily due to a 23% drop in the medium and heavy-duty truck market, which still represents 40% of total product sales. SG&A expenses increased to 16.6% of sales, or 13.8% excluding one-time items, up from 11.5% in the prior year period, reflecting elevated investments in Mexico expansion and leadership succession planning. Operating income fell to $2.3 million in Q2, down from $5.2 million in the prior year quarter, due to the higher SG&A investments. The company incurred $3.4 million in Mexico expansion costs and $1.4 million in succession-related expenses during the first half of 2026, which weighed on profitability. Return on capital employed (ROCE) remains low at 5.7% (6.2% excluding cash), well below the long-term goal of 14%, as new programs are still ramping up and asset utilization is not yet at optimal levels. The upcoming change in emissions regulations on January 1, 2027, creates uncertainty in the truck market, with potential for short-term volume disruptions due to pre-buying or order timing shifts. The company's growth is heavily dependent on the successful launch of new programs, with the majority of the $63 million in 2025 awards not expected to contribute meaningfully until the second half of 2026 and reach full run rates in 2027. Q: Can you expand on the encouraging signs in the truck market and your expectations for the second half of 2026? A: Erik Palomaki (President and CEO) confirmed that the first half of 2026 was on the lower side for truck production, but the company sees a recovery in the second half. This is supported by industry forecasts predicting increases over the next 2.5 years, as well as current order books and day-to-day activity across all truck customers, which indicate a stronger second half. Q: Can you provide more color on the momentum in non-truck and non-power sports markets and the opportunity over the next couple of years? A: Erik Palomaki (President and CEO) highlighted that of the $25.8 million in new wins in the first half, 65% originated outside traditional truck and power sports markets. Key opportunities include utility infrastructure for underground data cables and AI data center connectivity, where composite solutions are replacing concrete due to lighter weight and easier installation. He also noted a new SMC compound win within the trucking business and an electric vehicle tailgate cover. Importantly, 74% of new business will be produced on existing US assets, requiring no major capital investment. Q: You mentioned broadening the scope of M&A opportunities, including larger transactions. Can you walk us through your thinking on the acquisition front? A: Erik Palomaki (President and CEO) stated that he and CFO Alex Panda have been evaluating about one opportunity per month, ranging in scale. The focus is not on a specific size but on finding opportunities that are accretive, add diversification to the portfolio, and offer a good return on capital employed. The key is staying disciplined to ensure a fit with Core Molding's culture, processes, and DNA. Q: Is the $18 million in tooling revenue from Q2 of last year a leading indicator for the current growth, or are they unrelated? A: Alex Panda (CFO) clarified that in this specific case, they are not connected. The large tooling project from Q2 and Q4 of last year relates to an international truck job that will launch in early 2027 as a replacement program. While tooling revenue typically leads to product sales revenue, this specific instance is an exception. Q: What is the normal lag time between tooling revenue and production revenue? A: Erik Palomaki (President and CEO) explained that the average lag is 12 to 24 months for larger assembled products like hoods, roofs, or watercraft. However, for SMC compound projects that are more "mold and ship" with no complex assembly, the timeline can be compressed to 6 to 7 months. The company has secured several wins well under the 12-month mark. Q: Can you tie the anticipated truck market growth over the next 2.5 years into the current regulatory environment and how it might affect moves to new models? A: Erik Palomaki (President and CEO) noted that while the industry predicts continued growth for Class 8 and medium-duty trucks, the wild card is the emissions regulations set to change on January 1, 2027. This will require powertrain differences for all OEMs, potentially causing short-term, quarter-over-quarter volume impacts due to added costs. However, it is unlikely to change the overall annual trend over the next 2.5 to 3 years. Even if standards are rolled back, the hardware changes are already designed in, so OEMs won't alter them. Q: Do the new emissions regulations apply to trucks produced, ordered, or delivered after January 1st, and does this create an incentive for buyers to wait until December to place orders? A: Erik Palomaki (President and CEO) explained that the regulation is tied to when the VIN number is issued on the engine, not the chassis. Trucks built before December 31st can be delivered later and still qualify under 2026 emissions rules. This creates a "pre-buy" incentive, where build slots fill up late in the year, forcing buyers to order earlier. This dynamic is already contributing to increased run rates in August. Q: Is the incentive for manufacturers to produce as many trucks as possible before December 31st to sell them next year at a lower price or higher margin? A: Erik Palomaki (President and CEO) confirmed that historical data from prior emissions changes supports this behavior. Manufacturers are incentivized to build trucks before the deadline to avoid the higher costs associated with new regulations, and this pattern is expected to repeat with the upcoming emissions change. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Proto Labs (PRLB) came out with quarterly earnings of $0.6 per share, beating the Zacks Consensus Estimate of $0.54 per share. This compares to earnings of $0.41 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +11.11%. A quarter ago, it was expected that this custom parts manufacturer would post earnings of $0.4 per share when it actually produced earnings of $0.54, delivering a surprise of +35%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. Proto Labs, which belongs to the Zacks Rubber - Plastics industry, posted revenues of $149.34 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 2.74%. This compares to year-ago revenues of $135.06 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Proto Labs shares have added about 48.5% since the beginning of the year versus the S&P 500's gain of 8.7%. While Proto Labs has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Proto Labs was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.51 on $147.39 million in revenues for the coming quarter and $2.07 on $576.01 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Rubber - Plastics is currently in the top 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Core Molding Technologies (CMT), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 4. This maker of fiber reinforced plastics is expected to post quarterly earnings of $0.21 per share in its upcoming report, which represents a year-over-year change of -55.3%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Core Molding Technologies' revenues are expected to be $60.05 million, down 24.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Proto Labs, Inc. (PRLB) : Free Stock Analysis Report Core Molding Technologies Inc (CMT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Core Molding Technologies (CMT) came out with quarterly earnings of $0.07 per share, missing the Zacks Consensus Estimate of $0.22 per share. This compares to earnings of $0.25 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -68.18%. A quarter ago, it was expected that this maker of fiber reinforced plastics would post earnings of $0.23 per share when it actually produced earnings of $0.36, delivering a surprise of +56.52%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Core Molding Technologies, which belongs to the Zacks Rubber - Plastics industry, posted revenues of $58.58 million for the quarter ended March 2026, missing the Zacks Consensus Estimate by 1.43%. This compares to year-ago revenues of $61.45 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Core Molding Technologies shares have added about 22.3% since the beginning of the year versus the S&P 500's gain of 7.6%. While Core Molding Technologies has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Core Molding Technologies was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.38 on $66.25 million in revenues for the coming quarter and $1.68 on $283.51 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Rubber - Plastics is currently in the top 41% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Intellicheck Mobilisa, Inc. (IDN), another stock in the broader Zacks Industrial Products sector, has yet to report results for the quarter ended March 2026. The results are expected to be released on May 12. This company is expected to post quarterly earnings of $0.02 per share in its upcoming report, which represents a year-over-year change of +200%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Intellicheck Mobilisa, Inc.'s revenues are expected to be $5.64 million, up 15.3% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Core Molding Technologies Inc (CMT) : Free Stock Analysis Report Intellicheck Mobilisa, Inc. (IDN) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research