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Reasons to Add Milacron (MCRN) Stock to Your Portfolio Now
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Shares of Milacron Holdings Corp. have been performing well, of late. The company’s shares have rallied around 36.6% over the past six months on the back of solid order growth, geographic expansion as well as cost-reduction initiatives undertaken over the past few years. We believe this is the right time to add the stock as the company has solid prospects and is poised to maintain its bullish momentum.
Let’s delve deeper into the factors that make Milacron an attractive investment option.
What Makes Milacron an Attractive Pick?
Solid Rank & VGM Score: Milacron currently carries a Zacks Rank #2 (Buy) and has a VGM Score of B. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities. Thus, the company appears to be a potential investment proposition at the moment.
Above the Industry: Milacron has outperformed the industry it belongs to in the year-to-date period. The company’s shares have jumped 11.1%, while the industry lost around 4.3% during the same time frame.
Positive Earnings Surprise History: Milacron has an impressive earnings surprise history. It outpaced the Zacks Consensus Estimate in three out of the trailing four quarters, delivering an average positive earnings surprise of 9.37%.
Estimates Northbound: Estimates for Milacron have moved up over the past 30 days, reflecting analysts’ confidence in the stock. The Zacks Consensus Estimate has climbed more than 6% to $1.88 and 6.5% to $1.98 for 2018 and 2019, respectively, during this period.
Attractive Valuation: Going by the price earnings (P/E) multiple, Milacron is currently trading at a trailing 12-month P/E multiple of 12.6x — lower than the industry average of 16.0x.
Solid Q4: Milacron reported fourth-quarter 2017 adjusted earnings per share of 59 cents, comfortably beating the Zacks Consensus Estimate of 39 cents by a wide margin of 51%. In addition, earnings jumped 26% year over year. Revenues also improved 12% year over year in the quarter, surpassing the Zacks Consensus Estimate.
Growth Drivers in Place: Milacron remains focused on growing revenues and operating profits through selective initiatives that leverage its market position, geographic footprint and core competencies. The company expects that continued penetration of hot runners and incremental share gain from new products will stoke revenue growth.
Further, Milacron has undertaken a number of organizational redesigning and cost-reduction initiatives over the past three years. The main actions include realigning the overall cost structure, consolidating sales offices and call centers, along with optimizing its manufacturing footprint. These actions are projected to yield approximately $35 million of annual run-rate cost savings by the end of 2018.
Milacron recorded orders of $1.3 billion in 2017, up 9% year over year. The company ended the year with a strong backlog of $287 million. This was driven by strong order levels in after-market business in North America, China, and particularly in the hot-runner business and India-based equipment business.
This robust backlog positions the company well for the first quarter of 2018. Backed by the recent upbeat momentum in the global economy, Milacron projects sales growth of 2-4% in the current year.
Moreover, Milacron will benefit from solid order growth, continued momentum in emerging markets (India, China) as well as cost-reduction initiatives.
Avery Dennison has a long-term earnings growth rate of 7%. Its shares have rallied 23.9%, over the past six months.
Caterpillar has a long-term earnings growth rate of 10.3%. The company’s shares have been up 28.3% during the same time frame.
Disco Corporation has a long-term earnings growth rate of 20%. The stock has gained 24.2% in six months’ time.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Image: Bigstock
Reasons to Add Milacron (MCRN) Stock to Your Portfolio Now
Shares of Milacron Holdings Corp. have been performing well, of late. The company’s shares have rallied around 36.6% over the past six months on the back of solid order growth, geographic expansion as well as cost-reduction initiatives undertaken over the past few years. We believe this is the right time to add the stock as the company has solid prospects and is poised to maintain its bullish momentum.
Let’s delve deeper into the factors that make Milacron an attractive investment option.
What Makes Milacron an Attractive Pick?
Solid Rank & VGM Score: Milacron currently carries a Zacks Rank #2 (Buy) and has a VGM Score of B. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities. Thus, the company appears to be a potential investment proposition at the moment.
Above the Industry: Milacron has outperformed the industry it belongs to in the year-to-date period. The company’s shares have jumped 11.1%, while the industry lost around 4.3% during the same time frame.
Positive Earnings Surprise History: Milacron has an impressive earnings surprise history. It outpaced the Zacks Consensus Estimate in three out of the trailing four quarters, delivering an average positive earnings surprise of 9.37%.
Estimates Northbound: Estimates for Milacron have moved up over the past 30 days, reflecting analysts’ confidence in the stock. The Zacks Consensus Estimate has climbed more than 6% to $1.88 and 6.5% to $1.98 for 2018 and 2019, respectively, during this period.
Attractive Valuation: Going by the price earnings (P/E) multiple, Milacron is currently trading at a trailing 12-month P/E multiple of 12.6x — lower than the industry average of 16.0x.
Solid Q4: Milacron reported fourth-quarter 2017 adjusted earnings per share of 59 cents, comfortably beating the Zacks Consensus Estimate of 39 cents by a wide margin of 51%. In addition, earnings jumped 26% year over year. Revenues also improved 12% year over year in the quarter, surpassing the Zacks Consensus Estimate.
Growth Drivers in Place: Milacron remains focused on growing revenues and operating profits through selective initiatives that leverage its market position, geographic footprint and core competencies. The company expects that continued penetration of hot runners and incremental share gain from new products will stoke revenue growth.
Further, Milacron has undertaken a number of organizational redesigning and cost-reduction initiatives over the past three years. The main actions include realigning the overall cost structure, consolidating sales offices and call centers, along with optimizing its manufacturing footprint. These actions are projected to yield approximately $35 million of annual run-rate cost savings by the end of 2018.
Milacron recorded orders of $1.3 billion in 2017, up 9% year over year. The company ended the year with a strong backlog of $287 million. This was driven by strong order levels in after-market business in North America, China, and particularly in the hot-runner business and India-based equipment business.
This robust backlog positions the company well for the first quarter of 2018. Backed by the recent upbeat momentum in the global economy, Milacron projects sales growth of 2-4% in the current year.
Moreover, Milacron will benefit from solid order growth, continued momentum in emerging markets (India, China) as well as cost-reduction initiatives.
Other Stocks to Consider
Some other similarly-ranked stocks in the sector include Avery Dennison Corporation (AVY - Free Report) , Caterpillar Inc. (CAT - Free Report) and Disco Corporation (DSCSY - Free Report) . You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Avery Dennison has a long-term earnings growth rate of 7%. Its shares have rallied 23.9%, over the past six months.
Caterpillar has a long-term earnings growth rate of 10.3%. The company’s shares have been up 28.3% during the same time frame.
Disco Corporation has a long-term earnings growth rate of 20%. The stock has gained 24.2% in six months’ time.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
Click for details >>