Titan International Inc.

Titan International Inc. (TWI - Snapshot Report) reported a record second quarter and still sees bright days ahead as the commodities and agriculture industries continue to grow. This Zacks #1 Rank (strong buy) has attractive valuations with a P/S ratio of just 0.7 which indicates it is undervalued.

Titan manufactures wheels, tires and assemblies for big equipment makers in agriculture, construction, and mining sectors as well as for consumers for all-terrain vehicles.

CEO Bullish on 2012 and Beyond

In an unusual move, on Aug 22, Titan put out a press release with a statement from Chairman and CEO Maurice Taylor, Jr. about what is going on in the farm, construction and mining markets due to concerns from investors and analysts about the global economy.

The infrastructure companies will be among the first to see a slowdown, if one occurs, but as of August 22, Taylor wasn't seeing it in his discussions with equipment manufacturers.

He stated that the farming equipment makers were having their best year ever due to record farming profits. The construction equipment market was also growing, but slowly, due to housing still having difficulties. But Taylor said the export market for construction equipment was strong.

He described the mining business as "exploding".

Titan Will Benefit

Taylor said that over the next 3 months, Titan plans to obtain a minimum of $150 to $200 million of new construction and earthmoving business in wheels and tires going forward for 2012, 2013 and 2014.

The business will fill its North American tire facilities and increase its volumes in Brazil.

"Therefore, our new mottos are "Plant farmer, plant" and "Dig baby, dig"," he said.

"The future looks great. This is how I see it. As President Ronald Reagan said, our best days are yet to come," he added.

Record Second Quarter Results

On July 27, Titan reported record revenue and earnings for the second quarter. Sales soared 76% to $404.4 million from $229.7 million in the second quarter of 2010.

This was boosted by the April acquisition of the Goodyear Latin American farm tire business, including the Sao Paulo, Brazil manufacturing facility, as well as strong demand in each of its market segments.

Earnings per share were 49 cents compared to the consensus of 39 cents. The company made just 12 cents in the year ago quarter.

Zacks Consensus Estimates Jump

Given all the bullish statements coming out of the company, and the earnings surprise, analysts moved to raise full year estimates.

The 2011 Zacks Consensus Estimate jumped to $1.63 from $1.39 per share in the last 60 days.

That is earnings growth of 232% as the company only made 49 cents in all of 2010.

Lots of Value

Like many stocks, shares of Titan broke their 2 year rally during the recent summer sell off. The pullback has made the stock cheaper.

In addition to a P/S ratio under 1.0, the company's forward P/E is indicating "value" at just 12.2. A P/E under 15 is usually considered "value."

Titan also has a price-to-book ratio of only 2.1. A P/B ratio under 3.0 usually indicates value.

Titan pays a dividend, but with a yield of just 0.1%, it's not much. Instead, investors are buying the company for its growth potential and its attractive valuations.

The agriculture and mining sectors are hot. Titan is a way to play both of those industries in one shot.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Turnaround Trader and Insider Trader services. You can follow her at twitter.com/traceyryniec.