Ero Copper Reports Second Quarter 2025 Operating and Financial Results
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Globe and Mail
2 hours ago
- Globe and Mail
Is QuantumScape a Buy After Battery Breakthroughs?
Key Points QuantumScape has figured out how to make electric vehicle batteries better than the current state of the art. It's still not actually manufacturing these batteries at scale, and it's not clear when it might begin doing so. This stock's inability to hold on to its recent gains is a red flag, but the retracement seems exaggerated. 10 stocks we like better than QuantumScape › The past few weeks have been wild ones for QuantumScape (NYSE: QS) shareholders. After it drifted to a multi-year low in April, something suddenly lit a fire under this electric vehicle (EV) technology stock in late June. Shares were up by more than 200% less than a month later. That something was a breakthrough in how the company manufactures its high-performance EV battery packs. A key step in the process can now be completed about 25 times faster than before, offering the market some assurance that this pre-commercialization outfit will have the production capacity it needs when it needs it. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue » Nearly half of that gain has unsurprisingly been unwound in the meantime. Investors jumped in response to the news, but eventually remembered that there's more this start-up needs to accomplish before mass commercialization. On the other hand, this pullback could also prove to be a fantastic second chance to dive in at a decent price. What's QuantumScape? First things first. What the heck is QuantumScape? This company makes lithium-based batteries like the ones the majority of modern electric vehicles require. QuantumScape's batteries are better than the standard lithium-ion battery you'll find powering most EVs these days. Not only are its solid-state lithium battery packs capable of storing more energy, they don't require the usual anode, tackling two of the EV battery business' lingering challenges. This simpler design not only translates into lower manufacturing costs, but also lower overall materials costs on a per-watt basis. The only problem? QuantumScape's batteries aren't actually being manufactured at commercial scale yet. It's not entirely clear how much it will cost or how difficult it will be to do so, either. The only powerpacks it's made so far are prototypes provided to carmakers that want to tinker with the technology in their own electric vehicles. Still, the science is quite promising. The solid-state batteries the company has made provide on the order of 15% to 40% more driving range than comparable conventional lithium-ion batteries do. Perhaps more importantly, they're far more durable. QuantumScape's own testing indicates that its powerpacks are capable of holding 95% of their original charge capacity, even after 1,000 recharges. That's about 300,000 miles worth of driving, alleviating one of would-be EV owners' top cost concerns -- the eventual replacement of their electric vehicle's battery at a price tag of anywhere between $10,000 and $20,000. A big leap forward Given all this, the company's story is compelling. The question is: How close is QuantumScape to actually manufacturing an affordable and functional solid-state EV battery at scale? Well, it's at least one step closer to this endzone than it was a little over a month ago. In late June, QuantumScape announced it had successfully integrated its advanced "Cobra" separator process into the production of its baseline lithium cells. That means the ceramic-based separator between its batteries' solid cathodes and the company's anode alternative can now be layered into place about 25 times faster than the company's previous fabrication process. That's the whole reason for July's brilliant burst of bullishness. Welcome to the world of story stocks. Still, it's easy to see why the market suddenly became so excited. This is no small matter. This ceramic material negates the need for a porous polymer separator between the liquid electrolyte and lithium metal material found inside most common lithium-based batteries. Not only is the solid nature of QuantumScape's battery materials more efficient at transferring a charge from one side of the battery to another, there's little loss of this efficiency over time, compared to a fluid material. Liquid electrolytes are also potentially just more dangerous than their solid-state counterparts, since they're more likely to be ignited and burn out of control than solid-state batteries. More to the point for investors, being one (admittedly big) step closer to being able produce its batteries at scale is a big win for QuantumScape, and its shareholders. Even if the bulls did end up getting ahead of themselves and have since cooled their jets, that's what catapulted the stock higher in July, reminding investors that story stocks like this one can be quite unpredictable. Don't waste the in-the-meantime The overarching question remains: Is QuantumScape stock a buy following its battery breakthrough? One of the key details glossed over by the noise of the recent run-up is that this $5 billion company is still bleeding money. It spent over $500 million last year, mostly on research and development, topping 2024's and 2023's outlays. And there's not a stitch of revenue yet. That's not an unusual situation for a start-up that's still refining what could be a game-changing technology; you have to spend money to make money. But it's a concern when there's less than $1 billion worth of cash and liquid assets on the balance sheet. Fund-raising could be in the cards. There's also no assurance that paying customers will actually step up once at-scale production becomes possible. The company's said both should materialize sometime in 2026, but such timelines are difficult to predict when a technological solution is as new as this one is. Either way, meaningful revenue wouldn't likely start to flow until 2027 or even 2028, with profits unlikely for at least a while after that. Nevertheless, Volkswagen -- the world's second-biggest automaker, and one of its biggest EV manufacturers -- has remained interested and financially supportive for years now when it didn't have to do so. It's QuantumScape's single biggest shareholder, in fact. Given how close QuantumScape is to the finish line now, it would be surprising if Volkswagen didn't see the development of these superior EV batteries all the way through. The only catch is that the massive automaker probably doesn't care at this point if QuantumScape ever actually turns a profit. It just wants the advanced lithium batteries. That's not the case for individual QS shareholders. Bottom line? Buy it if you're inclined to take a big risk with a potentially big reward. Just be prepared for plenty of volatility, and the possibility of significant losses. Even for most risk-tolerant investors, the odds of any meaningful long-term upside aren't quite high enough here to justify the amount of risk you'd actually be taking on. Sure, that could change in the future. Just don't miss out on other opportunities in the meantime while you're waiting to see if this story stock that raises more questions than it answers actually pans out. Don't sweat not getting in on the proverbial ground floor, either. If QuantumScape's tech is going to pay off, that will become clear enough once real revenue starts to flow. Should you invest $1,000 in QuantumScape right now? Before you buy stock in QuantumScape, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and QuantumScape wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $624,823!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,064,820!* Now, it's worth noting Stock Advisor's total average return is 1,019% — a market-crushing outperformance compared to 178% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 29, 2025
Globe and Mail
3 hours ago
- Globe and Mail
American Vanguard (AVD) Q2 Loss Down 93%
Key Points GAAP EPS of $(0.03) for Q2 2025 beat expectations, narrowing GAAP losses from $(0.42) in Q2 2024. Revenue (GAAP) reached $129.3 million, exceeding consensus estimates and increasing 1% year-over-year. These 10 stocks could mint the next wave of millionaires › American Vanguard (NYSE:AVD), a specialty and agricultural chemicals producer with a growing global footprint, released its earnings for the second quarter of fiscal 2025 on August 1, 2025. The company reported a GAAP earnings per share (EPS) loss of $(0.03), which surpassed analyst GAAP estimates of $(0.11). Revenue (GAAP) came in at $129.3 million, topping GAAP forecasts of $125.0 million and slightly up from $128.2 million in GAAP net sales in Q2 2024. Key achievements for the quarter included strong gains in adjusted EBITDA, an expansion in gross profit margins to 31% from 29% in Q2 2024, and continued reductions in operating expenses and debt. The results marked an early turnaround from the prior year's losses, as American Vanguard reported GAAP EPS of $(0.03) compared to $(0.42) in Q2 2024, though Continued net losses (GAAP) and restrained top-line growth in the first half of 2025 highlight that challenges remain. Metric Q2 2025 Q2 2025 Estimate Q2 2024 Y/Y Change EPS (GAAP) ($0.03) ($0.11) ($0.42) N/A Revenue (GAAP) $129.3 million $125.0 million $128.2 million 1% Adjusted EBITDA $11.0 million $6.2 million 77% Gross Profit Margin 31% 29% 2 pp Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report. Company Overview and Focus American Vanguard is a North America–based manufacturer specializing in crop protection chemicals, including insecticides, herbicides, and soil fumigants for agriculture and turf. Its product portfolio also extends to environmental products and biological solutions, serving customers in the United States and over 40 international markets. In recent years, the company's strategy has centered on innovation—especially 'green' chemistry, regulatory compliance, and expanding its global presence. American Vanguard's performance relies on its ability to develop new formulations, execute cost discipline, comply with evolving regulations, and differentiate its offerings in niche markets. Quarterly Performance: Recovery in Progress Financial results for the period showed tangible progress in operational improvement. GAAP EPS came in well ahead of estimates, narrowing the quarterly net loss (GAAP) to $0.85 million from $11.7 million in the prior-year quarter. While overall sales (GAAP) grew 1%, this reversed the declines of earlier quarters and indicated an easing of the customer destocking cycle. Segment results showed U.S. crop sales rose 1% to $52.7 million (GAAP). Management noted, 'Customer destocking is beginning to subside. Against this backdrop, we were able to increase revenue by approximately 1% year-over-year (GAAP).' The top-line result masked a much stronger recovery in profitability. Adjusted EBITDA, a measure of core operating performance that excludes unusual items, climbed to $11.0 million from $6.2 million year-over-year. The gross profit margin—calculated as gross profit divided by revenue—jumped two percentage points year-over-year to 31% (GAAP). The improvement in gross profit margin came despite flat sales and reflected both lower cost of goods sold and improvements in manufacturing and procurement processes (GAAP). Gross profit itself rose 7% year-over-year on a GAAP basis, assisted by a 2% reduction in cost of sales year-over-year. Cost discipline underpinned these gains. Selling, general, and administrative (SG&A) expense (GAAP) dropped to $28.8 million from $31.1 million. Research, product development, and regulatory costs were also sharply lower at $5.8 million, reflecting reduced spending on transformation initiatives. One-time transformation charges, tied to restructuring efforts, fell to $1.6 million from $7.3 million year-over-year. As a result, operating income improved from a loss of $9.2 million in Q2 2024 to a gain of $4.4 million. Balance sheet trends showed continued focus on liquidity and working capital management. Inventory at the end of Q2 2025 was $191 million, representing a $53 million reduction from a year earlier. Debt outstanding also fell $22 million compared to last year to $189 million at quarter-end. The company highlighted its ongoing plan to use free cash flow primarily to reduce debt going forward. Within its product portfolio, metam sodium (a soil fumigant) and Thimet (a soil insecticide for peanuts and corn) were called out as bright spots. Prior headwinds such as the withdrawal of Dacthal (previously used in certain crops), weaker demand in the agave market in Mexico, and drought in Australia weighed on international results, but did not deepen in the period. There was no material commentary on new product launches for the quarter, though management emphasized an ongoing shift toward differentiated and sustainable solutions. No significant regulatory or compliance events were noted, though costs in this area remain a structural consideration. Cash used in operations for the six months ended June 30, 2025 stood at $39.8 million, an improvement from $49.4 million in the same period of 2024. The company did not announce any dividend changes for the quarter and did not specify a current payout. AVD does not currently pay a dividend. Guidance and Looking Ahead American Vanguard's management reaffirmed its full-year guidance, despite earlier reductions to estimates in the first quarter. For FY2025, the company expects revenue of $535–$545 million (GAAP), and adjusted EBITDA guidance of $40–$44 million for the full year 2025 (non-GAAP). This outlook reflects ongoing caution about the pace of agricultural recovery and the persistence of competitive market dynamics. Leadership continues to focus on cost control, inventory reduction, and margin improvement. Management stated, 'the agriculture economy appears to be in the early stages of a recovery.' Investors will want to monitor revenue trajectory, progress on restoring sustained profitability, and execution on debt reduction in the coming quarters. No new quantitative guidance was issued for dividends or other near-term capital allocation initiatives. Persistent net losses and modest top-line growth remain areas for close scrutiny as the turnaround progresses. Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted. Where to invest $1,000 right now When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor's total average return is 1,036%* — a market-crushing outperformance compared to 181% for the S&P 500. They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor. See the stocks » *Stock Advisor returns as of July 29, 2025
Globe and Mail
3 hours ago
- Globe and Mail
3 Unstoppable Stocks to Buy in August
Key Points Investors have multiple reasons to like AbbVie stock. Eli Lilly remains a top stock to buy and hold. Vertex Pharmaceuticals is moving quickly to expand its markets beyond cystic fibrosis. 10 stocks we like better than AbbVie › The "it" factor. Some stocks have it. Other stocks don't. But the ones that do can be virtually unstoppable. Three Motley Fool contributors believe they've found such unstoppable stocks with the "it" factor to buy in August -- and they're all in the healthcare sector. Here's why they picked AbbVie (NYSE: ABBV), Eli Lilly (NYSE: LLY), and Vertex Pharmaceuticals (NASDAQ: VRTX). There are many reasons to buy this stock Prosper Junior Bakiny (AbbVie): It's been a little over two years since AbbVie lost patent exclusivity for its best-selling drug, autoimmune disease medicine Humira. That didn't stop AbbVie, though; it just slowed it down momentarily. The company rebounded nicely and has since returned to top-line growth. AbbVie now owns another one of the top-10 selling therapies in the world, Skyrizi, which targets several immunology conditions. Skyrizi's sales have been growing at an incredibly rapid rate. Together with Rinvoq, AbbVie's immunology lineup has successfully filled the gap left by Humira. That's an important reason to consider the stock: AbbVie's ability to overcome a significant patent cliff speaks volumes about its innovative abilities. Beyond that, AbbVie's lineup is deep. It features older products that continue to make meaningful contributions to its financial results, such as its Botox franchise, and newer products that can help drive top-line growth for a while, like migraine treatment Qulipta. AbbVie's pipeline also looks deep. The company should be able to record consistent clinical and regulatory wins. Lastly, we can't mention AbbVie without pointing out its incredible dividend track record. The company is part of the exclusive group of Dividend Kings, boasting an active streak of 53 consecutive payout increases, which includes the time it spent as a division of its former parent company, Abbott Laboratories. AbbVie's forward yield of 3.5% is much higher than the S&P 500 's average of 1.3%, and its cash payout ratio looks reasonable at 61.8%. In addition to an excellent underlying business, a strong lineup, and a solid pipeline, AbbVie is an outstanding stock for income-seeking investors. Investing in this company could yield superior returns over the long term. Eli Lilly is a top growth stock to own for years David Jagielski (Eli Lilly): A stock that looks unstoppable right now is Eli Lilly. While many investors will focus on its highly successful GLP-1 drugs, Zepbound and Mounjaro, as the main reasons to invest in the business, there's much more behind the company, and why it's a top growth stock. Eli Lilly has a promising Alzheimer's treatment, Kisunla, which regulators approved for use last year. It's still in the early innings of its growth and according to analysts, it could generate up to $5 billion in annual revenue at its peak. Meanwhile, Eli Lilly is still focusing on developing more life-changing treatments for patients. It's planning to invest $4.5 billion into a research and manufacturing facility, which it calls Lilly Medicine Foundry. By utilizing new manufacturing methods to ensure high efficiency, the new center can help the company scale and bring new products to market faster. The company also has vast resources at its disposal, which can help it invest in research and development and potentially acquire promising businesses along the way. In the trailing 12 months, Eli Lilly has generated $11.1 billion in profit on sales totaling $49 billion. The company's terrific margins, strong growth prospects, and commitment to producing new treatments are why this pharmaceutical stock can be among the best investments you can put in your portfolio right now. A big biotech innovator that's targeting new markets Keith Speights (Vertex Pharmaceuticals): To truly be unstoppable, a company can't have competition that could, well, stop it. Vertex Pharmaceuticals has this covered with its cystic fibrosis (CF) franchise. No other drugmaker has approved therapies that treat the underlying cause of CF. The number of companies with experimental CF therapies in late-stage clinical testing that could compete with Vertex totals... zero. Actually, Vertex's biggest rival in treating CF is itself. The company's newest CF therapy, Alyftrek, offers a more convenient once-per-day dosing than its current top-seller, Kaftrio/Trikafta. However, CF isn't the main reason why I like Vertex. My primary interests lie with other indications the biotech innovator is targeting. For example, Vertex won U.S. regulatory approval for Journavx earlier this year. It's the first new class of pain medication in over 20 years. Journavx is safe and effective, with none of the side effects and addictive potential associated with opioids -- because it isn't an opioid. The company's pipeline features promising late-stage programs that could further expand Vertex's market opportunity. Inaxaplin targets APOL1-mediated kidney disease, which affects around 250,000 patients worldwide. Povetacicept holds the potential to treat multiple kidney diseases, with IgA nephropathy first on the list with a patient population of over 1 million. Zimislecel could cure severe type 1 diabetes. At first glance, Vertex might seem to be priced at a premium, with its shares trading at 26.3 times forward earnings. However, the company's growth prospects are so strong that its valuation is attractive. Vertex's price-to-earnings-to-growth (PEG) ratio, based on analysts' five-year earnings growth estimates, is a super-low 0.58. Should you invest $1,000 in AbbVie right now? Before you buy stock in AbbVie, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AbbVie wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $625,254!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,090,257!* Now, it's worth noting Stock Advisor's total average return is 1,036% — a market-crushing outperformance compared to 181% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 29, 2025 David Jagielski has no position in any of the stocks mentioned. Keith Speights has positions in AbbVie and Vertex Pharmaceuticals. Prosper Junior Bakiny has positions in Eli Lilly and Vertex Pharmaceuticals. The Motley Fool has positions in and recommends AbbVie, Abbott Laboratories, and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
