XPEL (NASDAQ:XPEL) Releases Earnings Results, Beats Estimates By $0.08 EPS

XPEL (NASDAQ:XPEL) issued its quarterly earnings data on Wednesday. The company reported $0.68 EPS for the quarter, topping the consensus estimate of $0.60 by $0.08, FiscalAI reports. The company had revenue of $143.05 million during the quarter, compared to analyst estimates of $135.09 million. XPEL had a return on equity of 19.14% and a net margin of 10.82%.XPEL’s revenue was up 14.7% compared to the same quarter last year. During the same quarter in the previous year, the company posted $0.59 earnings per share.

Here are the key takeaways from XPEL’s conference call:

• Second-quarter revenue rose 14.7% to a record $143.1 million, exceeding management’s expectations despite approximately $2 million of sales pulled forward ahead of anticipated price increases. EBITDA increased 17.6%, while operating margin reached 16.2%.
• Operating cash flow reached a record $30.8 million, with improved cash conversion and lower days sales outstanding. Window film revenue grew 16.1% to $32.5 million, and management expects gross margin to increase modestly through the remainder of the year.
• Management expects third-quarter revenue of $137 million to $139 million, below Q2, reflecting seasonality, $1 million to $2 million of additional sales pulled forward, and continued weakness in Europe and the Middle East. Dealership demand remains pressured by FTC compliance concerns.
• XPEL is investing approximately $110 million in manufacturing facilities in San Antonio and China, with additional capital expenditures expected through early 2027. Incremental margin benefits are expected beginning in mid-2027, with a mid-20% operating-margin run rate targeted by the end of 2028.
• China revenue reached $15.9 million despite domestic vehicle sales declining approximately 20% year over year, while India grew more than 60%. Management also plans to pursue small service- and OEM-adjacent acquisitions and use remaining cash flow for share repurchases, though manufacturing-related startup costs reduced Q2 earnings by about $0.03 per share.

XPEL Stock Performance

Shares of NASDAQ XPEL traded down $2.53 during trading on Thursday, hitting $47.76. The company had a trading volume of 288,361 shares, compared to its average volume of 255,381. The stock has a 50 day simple moving average of $45.66 and a 200 day simple moving average of $46.01. XPEL has a 12 month low of $31.50 and a 12 month high of $55.91. The firm has a market capitalization of $1.32 billion, a P/E ratio of 25.02 and a beta of 1.09.

Institutional Investors Weigh In On XPEL

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Steward Partners Investment Advisory LLC raised its stake in XPEL by 462.9% during the 4th quarter. Steward Partners Investment Advisory LLC now owns 985 shares of the company’s stock worth $49,000 after acquiring an additional 810 shares during the period. Lazard Asset Management LLC purchased a new stake in shares of XPEL in the second quarter worth $55,000. Russell Investments Group Ltd. bought a new stake in shares of XPEL during the 3rd quarter valued at $66,000. Tower Research Capital LLC TRC raised its position in shares of XPEL by 234.0% during the 2nd quarter. Tower Research Capital LLC TRC now owns 2,886 shares of the company’s stock valued at $104,000 after purchasing an additional 2,022 shares during the period. Finally, Osaic Holdings Inc. raised its position in shares of XPEL by 319.7% during the 2nd quarter. Osaic Holdings Inc. now owns 2,984 shares of the company’s stock valued at $107,000 after purchasing an additional 2,273 shares during the period. 75.08% of the stock is owned by hedge funds and other institutional investors.

Key Headlines Impacting XPEL

Here are the key news stories impacting XPEL this week:

• Positive Sentiment: Q2 results beat expectations: XPEL reported second-quarter revenue of $143.1 million, up 14.7% year over year and above the $135.1 million consensus estimate. Adjusted earnings were $0.68 per share, topping estimates ranging from $0.60 to $0.61 and increasing from $0.59 a year earlier. Gross margin also improved to 44.1% from 42.9%. XPEL Reports Record Revenue of $143.1 million
• Positive Sentiment: Analyst becomes more bullish: B. Riley raised its price target from $55 to $65 and maintained a “Buy” rating, implying substantial upside from recent trading levels. Benzinga
• Positive Sentiment: Long-term margin ambitions: Management is targeting a mid-20% operating-margin run rate exiting 2028, suggesting potential for improved profitability if strategic initiatives succeed. XPEL targets mid-20% operating margin
• Negative Sentiment: Near-term guidance was slightly soft: XPEL forecast third-quarter revenue of $137 million to $139 million, narrowly below the $139.1 million analyst consensus. That modest shortfall may be prompting profit-taking despite the strong Q2 beat. XPEL third-quarter guidance

Analyst Upgrades and Downgrades

A number of research firms have weighed in on XPEL. Weiss Ratings reissued a “hold (c)” rating on shares of XPEL in a report on Wednesday, June 24th. B. Riley Financial upped their price target on shares of XPEL from $55.00 to $65.00 and gave the company a “buy” rating in a research report on Thursday. Freedom Capital cut shares of XPEL from a “strong-buy” rating to a “hold” rating in a research note on Thursday, May 7th. Finally, Zacks Research upgraded shares of XPEL from a “strong sell” rating to a “hold” rating in a research note on Monday, April 27th. One equities research analyst has rated the stock with a Buy rating and three have given a Hold rating to the stock. According to MarketBeat, the company currently has a consensus rating of “Hold” and an average target price of $65.00.

About XPEL

XPEL, Inc is a leading manufacturer and distributor of advanced protective films and coatings for automotive, marine, aviation, and architectural applications. The company’s core products include paint protection film (PPF), window tinting film, and ceramic coatings designed to shield surfaces from scratches, environmental contaminants, and UV damage. XPEL’s flagship PPF, known for its self-healing properties, is engineered to maintain a vehicle’s factory finish by resisting swirl marks, stone chips, and acid rain.

Beyond automotive protection, XPEL has expanded its offerings to include protective films for electronics and architectural surfaces, providing solutions that enhance durability and prolong the life of high-value assets.