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Metalico Inc. (MEA - Snapshot Report) has had a hard time surprising on estimates since I last reviewed it in May 2010 as it has missed two quarters in a row. However, the Zacks #2 Rank (buy) grew sales 50% in the third quarter as volumes and metal prices rose. Sales are expected to grow 27% over the next 5 years.

Metalico operates ferrous and non-ferrous recycling facilities in 7 states and 4 lead fabricating plants in 3 states. 2009 was a difficult year as both metal prices and demand plunged.

Unit Volumes Shipped Jumped Double Digits in the Third Quarter

On Oct 29, Metalico reported third quarter results which missed on the Zacks Consensus by 2 cents. Earnings per share were 8 cents compared to the 10 cents consensus.

Sales jumped to $137 million from $91.5 million in the third quarter of 2009. Unit volumes shipped for ferrous scrap rose 14% and increased 34% for non-ferrous scrap from a year ago. Platinum Group Metals (PGM) volumes shipped climbed 32%. Only lead volumes fell in the quarter, declining 15%.

Average selling price increased for all segments. Ferrous rose 35%, non-ferrous gained 22%, PGM jumped 39% and lead prices rose 14%.

The year over year comparisons look outstanding but 2009 was a very poor year. Compared with the second quarter of 2010, however, sales declined slightly.

Double Digit Earnings Growth Expected in 2011

The Zacks Consensus Estimate for 2010 moved up a penny to 40 cents in the last 60 days. This is earnings growth of 273.9% as the company lost 23 cents per share in 2009.

For 2011, analysts are expecting further earnings growth of 24.2%. The Zacks Consensus Estimate has moved up 2 cents to 50 cents in the last 2 months.

It is expected to report fourth quarter results on Mar 10, 2011.

Still a Value Stock?

Metalico is trading at 14.3x forward estimates which is just within the range I consider a value stock (of under 15x.) It is, however, much cheaper than its peers which are trading at 21.6x.

It has a price-to-book of 1.6, under its peers at 2.4 and also within the value range which is under 3.0.

Metalico is now a Zacks #2 Rank (buy) stock.

Read the May 12, 2010 article.

Update to Previous Value Zacks Rank Buy Stocks

Want to know how the global economy is faring? Look at trade. CAI International, Inc. (CAP) is trading at just 12.2x forward estimates even as container utilization rates continue at a historically high level. Read the full article.

Consumers continue to look for easy ways to update their wardrobes and one of those ways is through accessories. Genesco Inc. (GCO), a specialty shoe and hat retailer, has been riding that sentiment to double digit earnings growth in 2010. Read the full article.

What recession? Esterline Technologies (ESL) just reported a record year for fiscal 2010 as earnings jumped 23%. Shares are still not expensive, trading at just 14.7x forward estimates. Read the full article.

The automobile market is recovering strongly worldwide from its near death experience during the Great Recession. Magna International Inc. (MGA) is cashing in as sales rose 27% in the third quarter. With sales booming, the company recently raised its dividend by 20%. Read the full article.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

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