We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why You Should Buy Macquarie (MIC) Stock Right Now
Read MoreHide Full Article
Multi-sector stocks in the equity market have been gaining strength of late, on the back of escalating demand for air travel, technological upgrade in manufacturing processes, as well as improving operations in the oil and gas industry. Going forward, reduced corporate-tax rates, steaming-up industrial activity in the United States, and increased government spending will likely continue to benefit these companies.
Such multi-sector stocks are grouped under the Zacks Conglomerates sector that currently occupies the first position among the 16 Zacks sectors.
Earnings for the sector are anticipated to be up 2% year over year in 2018, on the back of around 4% annualized top-line increment.
Among the numerous potential gainers within the sector, adding Macquarie Infrastructure Corporation to your portfolio will be a promising investment move at the moment. This stock currently carries a Zacks Rank #2 (Buy).
Why to Grab the Stock?
Top-Line Prospects: Macquarie’s year-over-year revenue growth was 9.9% in 2017 and 4.9% in first-half 2018. The company believes higher general aviation light activity and strong contributions from the acquired fixed base operations will boost revenues of its Atlantic Aviation segment going forward. On the other hand, tariff-based sales from the thermal power generation plant and enhanced wind resources will likely continue to drive its Contracted Power segment’s top-line performance. In addition, implementation of new gas rates (July 2018) will likely improve Macquarie’s MIC Hawaii segment’s revenues in the near term.
Per our estimates, Macquarie’s year-over-year revenue growth is pegged at 1.7% and 0.6% for 2018 and 2019, respectively.
Over the past month, Macquarie’s shares have rallied 2.5%, outperforming 0.7% growth recorded by the industry as well as the sector.
Price Performance
Profitability: Over the past four quarters, Macquarie pulled off an average positive earnings surprise of 8.05%. In second-quarter 2018, the company’s adjusted earnings surpassed the Zacks Consensus Estimate by 9.8% and also came in 40.6% higher than the year-ago tally. The company stated that solid revenue growth, reduction in management fees, gains on derivative instruments and reduced corporate-tax rates drove the stellar bottom-line performance in the reported quarter.
We anticipate that these positives will continue to drive Macquarie’s earnings in the upcoming quarters. The company currently anticipates earnings before interest, taxes, depreciation and amortization(EBITDA) to be within $670-705 million in 2018.
Sound Investment Track: Macquarie intends to deploy approximately $300 million in bolt-on acquisitions and strategic growth projects in 2018. So far, this year, the company has invested around $200 million for completion of a new power generating facility, building up additional capacity in the IMTT segment and acquiring a fixed base business operating within the Atlantic Aviation segment (January 2018). The company expects that these moves will bolster its revenues and profitability in the upcoming quarters.
Gains from BEC Spin-Off: Macquarie expects that the divestiture of Bayonne Energy Center (inked July 2018) will strengthen its balance sheet and enhance financial flexibility, going forward. Eliminating fees and other expenses, the company anticipates realizing roughly $650-million proceeds from this spin-off. Macquarie intends to repay its existing debt, fund future growth investments and provide higher returns to shareholders with the proceeds from this transaction. Notably, the company estimates that its net-debt to EBITDA ratio will likely be less than 4.5x by the end of this year, supported by the divestiture.
Other Key Picks
Some other top-ranked stocks in the same space are listed below:
Carlisle Companies Incorporated (CSL - Free Report) holds a Zacks Rank #2. The company delivered off an average positive earnings surprise of 12.85% over the trailing four quarters.
Crane Company (CR - Free Report) also carries a Zacks Rank of 2. The company generated an average positive earnings surprise of 3.03% during the same time frame.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Image: Bigstock
Here's Why You Should Buy Macquarie (MIC) Stock Right Now
Multi-sector stocks in the equity market have been gaining strength of late, on the back of escalating demand for air travel, technological upgrade in manufacturing processes, as well as improving operations in the oil and gas industry. Going forward, reduced corporate-tax rates, steaming-up industrial activity in the United States, and increased government spending will likely continue to benefit these companies.
Such multi-sector stocks are grouped under the Zacks Conglomerates sector that currently occupies the first position among the 16 Zacks sectors.
Earnings for the sector are anticipated to be up 2% year over year in 2018, on the back of around 4% annualized top-line increment.
Among the numerous potential gainers within the sector, adding Macquarie Infrastructure Corporation to your portfolio will be a promising investment move at the moment. This stock currently carries a Zacks Rank #2 (Buy).
Why to Grab the Stock?
Top-Line Prospects: Macquarie’s year-over-year revenue growth was 9.9% in 2017 and 4.9% in first-half 2018. The company believes higher general aviation light activity and strong contributions from the acquired fixed base operations will boost revenues of its Atlantic Aviation segment going forward. On the other hand, tariff-based sales from the thermal power generation plant and enhanced wind resources will likely continue to drive its Contracted Power segment’s top-line performance. In addition, implementation of new gas rates (July 2018) will likely improve Macquarie’s MIC Hawaii segment’s revenues in the near term.
Per our estimates, Macquarie’s year-over-year revenue growth is pegged at 1.7% and 0.6% for 2018 and 2019, respectively.
Over the past month, Macquarie’s shares have rallied 2.5%, outperforming 0.7% growth recorded by the industry as well as the sector.
Price Performance
Profitability: Over the past four quarters, Macquarie pulled off an average positive earnings surprise of 8.05%. In second-quarter 2018, the company’s adjusted earnings surpassed the Zacks Consensus Estimate by 9.8% and also came in 40.6% higher than the year-ago tally. The company stated that solid revenue growth, reduction in management fees, gains on derivative instruments and reduced corporate-tax rates drove the stellar bottom-line performance in the reported quarter.
We anticipate that these positives will continue to drive Macquarie’s earnings in the upcoming quarters. The company currently anticipates earnings before interest, taxes, depreciation and amortization(EBITDA) to be within $670-705 million in 2018.
Sound Investment Track: Macquarie intends to deploy approximately $300 million in bolt-on acquisitions and strategic growth projects in 2018. So far, this year, the company has invested around $200 million for completion of a new power generating facility, building up additional capacity in the IMTT segment and acquiring a fixed base business operating within the Atlantic Aviation segment (January 2018). The company expects that these moves will bolster its revenues and profitability in the upcoming quarters.
Gains from BEC Spin-Off: Macquarie expects that the divestiture of Bayonne Energy Center (inked July 2018) will strengthen its balance sheet and enhance financial flexibility, going forward. Eliminating fees and other expenses, the company anticipates realizing roughly $650-million proceeds from this spin-off. Macquarie intends to repay its existing debt, fund future growth investments and provide higher returns to shareholders with the proceeds from this transaction. Notably, the company estimates that its net-debt to EBITDA ratio will likely be less than 4.5x by the end of this year, supported by the divestiture.
Other Key Picks
Some other top-ranked stocks in the same space are listed below:
Federal Signal Corporation (FSS - Free Report) sports a Zacks Rank of 1 (Strong Buy). The company pulled off an average positive earnings surprise of 22.48% over the past four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.
Carlisle Companies Incorporated (CSL - Free Report) holds a Zacks Rank #2. The company delivered off an average positive earnings surprise of 12.85% over the trailing four quarters.
Crane Company (CR - Free Report) also carries a Zacks Rank of 2. The company generated an average positive earnings surprise of 3.03% during the same time frame.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>