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Georgia Gulf Corp.
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Georgia Gulf Corp manufactures and sells a line of specialty chemicals in the United States and Internationally. The company was founded in 1984 and has a market cap of $1.05 billion.
Although GGC has been trending higher since July, shares recently spike higher on Q4 results that came in well ahead of expectations.
Fourth-Quarter Results
Revenue was up 38% from last year to $693 million. But earnings came in through the roof at 43 cents, blowing past the Zacks Consensus Estimate of 4 cents.
The company's largest segment, Chlorovinyls, posted an impressive gain, with sales up 34% to $320 million. But it's largest percent gain came from its Aromatics division, with sales more than doubling to $199 million.
Financial Profile
Georgia Gulf is using its strong earnings momentum to strengthen its balance sheet, with cash and equivalents up $84 million from last year to $123 million. The company is also chipping away at its debt, with total debt down $43 million from last year to $668 million.
Estimates
We saw some pretty solid movement in estimates off the good quarter, with the current year adding 14 cents to $1.22. The next-year estimate is up 3 cents in the same time to $1.43, a bullish 17% growth projection.
Valuation
In light of the recent string of gains, GGC looks a bit pricey, with its forward P/E of 25X a sharp premium to the industry average of 14X.
12-Month Chart
On the chart, GGC has been hot since July, recently spiking higher to a new 52-week high on the good quarter. Look for support from the long-term trend on any weakness, take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the Zacks Momentum Trader Service.
Read the full analyst report on GGC
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