How do you turn an Aeron chair into an Aer-off? You feed it Herman Miller’s (Nasdaq: MLHR) latest quarterly report.
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\nThe company behind the Aeron chair and other office furnishings didn’t necessarily have a bad third quarter. It just wasn’t enough to please the greedy prognosticators.<\/p>\n
Sales bounded 14% higher to hit $484.9 million. Gross and operating margins widened. Earnings per share rose 52% to $0.50. Favorable tax credits and the shrinking number of fully diluted shares outstanding helped inflate bottom-line results, but that still couldn’t get the creator of the cubicle to hit the $0.52-a-share mark that Wall Street was banking on. The pros were also looking for the top line to be 16% higher.<\/p>\n
So I understand why the market may not like the report — the shares were lower Wednesday night — but I’m encouraged. I see Herman Miller as a catalyst for Corporate America. I view the company and peers like Steelcase (NYSE: SCS), Knoll (NYSE: KNL), and HNI (NYSE: HNI) as perfect bellwethers. If business is booming for them, it means that companies are feeling confident enough about the future to order new office furniture.<\/p>\n
Sure, you can turn to office supply chains like Office Depot (NYSE: ODP), OfficeMax (NYSE: OMX), and Staples (Nasdaq: SPLS) for a similar perspective, but I prefer to stick to the furniture specialists. I see more merit in tracking the number of work desks that are being ordered than boxes of paper clips.<\/p>\n
Oh, and Corporate America is ordering. The order backlog at Herman Miller punched in 23% higher than it did a year earlier. That leaves the company with its highest third-quarter backlog in its storied history.<\/p>\n
Should investors expect good things to happen as those orders get filled in the coming quarters? I think so. It’s also how you turn an Aer-off back into an Aeron again.<\/p>\n
For more on these corporate bellwethers, check out:
\n\t\u00e2\u20ac\u00a2 \tHerman Miller Sitting Pretty
\n\t\u00e2\u20ac\u00a2 \tTruly a Champion
\n\t\u00e2\u20ac\u00a2 \tHard Days at Office Depot<\/p>\n
Herman Miller is a leader in the office furniture industry. Looking for other leaders that make for great investments? Then try The Motley Fool’s Stock Advisor newsletter free for 30 days.<\/p>\n
Longtime Fool contributor Rick Munarriz thinks that Dilbert and Office Space are hilarious, but he still respects furniture’s role in the workplace. He\u00c2\u00a0does not own shares in any of the companies in this story. Rick is also part of theRule Breakers newsletter research team, seeking out tomorrow’s ultimate growth stocks a day early. The Fool has a disclosure policy.<\/p>\n","protected":false},"excerpt":{"rendered":"
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