Back to top

Momentum

TPC Group, Inc. (TPCG) has been posting huge gains over the last few months, recently hitting a new multi-year high on another strong quarter and rising estimates. With a bullish growth projection and compelling valuation, this Zacks #1 rank stock has plenty of momentum.

Company Description

TPC Group, Inc. produces specialized lines of chemical products to chemical and petroleum companies worldwide. The company was founded in 1943 and has a market cap of $574 million.

Our last update on TPC Group came in early November when the company reported strong Q3 results that handily beat expectations.

First-Quarter Results

Revenue for the period was up 47% from last year to $499 million. Earnings also came in strong at 70 cents, 19% ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 36% over the last four quarters.

The strong quarter was driven by a combination of higher selling prices, up 44% from last year, and slightly higher volume, up 2% from last year.

Looking forward, the company noted that it will see a small seasonal slow down in the new year, but the general trend of increasing demand should remain in tact and enable it to deliver strong Q2 results.

Financial Profile

TPC Group will also benefit from a strong financial profile, with cash and equivalents of $34 million against $269 million in debt. Its long-term debt-to-capital ratio of 45% is well below the industry average of 87%.

Estimates

We have seen some movement in estimates over the last month, with the current year up 9 cents to $2.23 and the next-year estimate up 17 cents to $3.00, a bullish 35% growth projection.

Valuation

But in spite of the gains, TPCG still has value, trading with a forward P/E of 14X, a nice discount to the industry average of 15.5X.

2-Year Chart

On the chart, shares recently hit a new all-time high at $33.02 after rallying for most of the last few months on strong results and a bullish market. Look for support from the long-term trend line on any weakness, take a look below.

TPCG: TPC Group, Inc. >
<P ALIGN=

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%