Ingredion Incorporated ( INGR - Snapshot Report ) touched a new 52-week high of $65.62 on November 27 and has a year-to-date return of about 30%. This maker of starch and sweetener ingredients reported a solid third quarter late last month, including a raised EPS outlook for the full year. In addition to all this, an attractive price-to-earnings (P/E) ratio of just 11.8 makes this Zacks #1 Rank (Strong Buy) an attractive option for value investors.

Driving Catalysts

On October 25, Ingredion Incorporated announced third quarter earnings per share of $1.52, beating the Zacks Consensus Estimate by 17% and the year-ago performance by 27%.

Net sales grew 3% to $1.7 billion based on volumes and price increases. In addition, operational efficiency led to a 19% increase in operating income with margins standing at 10%.

The company now expects 2012 earnings per share between $5.47 and $5.57, versus the earlier projection of $5.00 to $5.25.

In its recent analyst meeting, the company outlined its long-term targets, including a 10%-12% increase in earnings per share, achieving more that an 8.5% return on capital employed, roughly $8 billion in revenues and operating margin improvement by 100-200 basis points.

Meanwhile, the company’s consistent policy of regular dividend payments bodes well for the company. Recently, an increase of 30% in the quarter’s dividend rate was announced.

Earnings Estimates Moving Higher

The Zacks Consensus Estimate for 2012 is currently $5.52 per share, which is up 6% in the past 2 months. The Zacks Consensus Estimate for 2013 is $5.88 per share, or nearly 5% better in the same time period. These estimates reflect year-over-year increases of 18.0% for 2012 and 6.5% for 2013.

Valuation & Technicals

Ingredion Incorporated is currently trading at a forward P/E multiple of 11.8 versus the peer group average of 15.4. On a P/S basis, shares trade at 0.8x versus the peer group average of 0.9x. The P/B of 2.0x is the same as the peer group average. The company offers a ROE of 17.8%, much higher than the peer group average of 13.1%.

A P/E ratio below 15.0, a P/B ratio under 3.0 and a P/S ratio lower than 1.0 generally indicate value.

Ingredion Incorporated is headquartered in Westchester, Illinois, and was incorporated in 1906. The company, formerly known as Corn Products International, Inc, makes starch and sweetener ingredients for its customer base in North America, South America, the Asia Pacific, Europe, the Middle East, and Africa. The company currently has a market capitalization of approximately $4.6 billion.

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