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Ingersoll-Rand Worth Buying on Healthy End Markets, Buyouts
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We believe that Ingersoll-Rand plc (IR - Free Report) is a solid choice for investors seeking exposure in the industrial machinery space.
The stock, with roughly $25-billion market capitalization, has been upgraded to a Zacks Rank #1 (Strong Buy) on Aug 30. Moreover, the stock’s investment appeal is accentuated by a favorable VGM Score of B.
The company delivered better-than-expected results in three out of the last four quarters, with an average positive earnings surprise of 5.29%.
Why the Upgrade?
We are providing a snapshot of how Ingersoll-Rand fared in second-quarter 2018. The company’s earnings of $1.85 per share surpassed the Zacks Consensus Estimate by 7.56%. Net sales went up 11% year over year on the back of sales growth of 11% in the Climate segment and 13% in the Industrial segment.
In the quarters ahead, Ingersoll-Rand stands to gain from growing popularity of the company’s products and services offered under its two segments — Climate Solutions and Industrial Technologies. Further, businesses in various end markets — including commercial HVAC (heating, ventilation, and air conditioning), residential HVAC, transport, industrial and other — seem to be healthy. Continued investment to boost technological expertise, develop innovative products and business expansion in the Chinese market remains a boon for the company.
Another interesting aspect about Ingersoll-Rand is its acquisitive nature. In this regard, the buyout of ICS Cool Energy in January 2018 is worth mentioning. Since acquired, ICS Cool Energy has been strengthening the company’s commercial HVAC business. Further, the company strongly believes in rewarding shareholders handsomely. Cash of $222 million was used for paying dividends in the first half of 2018 (with 18% hike in quarterly dividend rate announced in June) while shares worth $500 million were repurchased.
For 2018, Ingersoll-Rand has increased its projection for adjusted earnings per share of approximately $5.50 from the earlier guidance of $5.00-$5.20. Organic sales are anticipated to increase 7-8% versus 3-3.5% expected earlier, while total revenues are forecasted to increase 9-10% against the prior prediction of 5-5.5%.
In the past 60 days, the company’s earnings estimates for 2018 and 2019 have been revised upward by eight brokerage firms. The Zacks Consensus Estimate now stands at $5.54 for 2018 and $6.21 for 2019, reflecting growth of 4.7% from the respective 60-day-ago tallies.
Moreover, the company’s price performance has been impressive. The stock has yielded a 16.3% return in the past three months, outperforming 7.3% growth recorded by the industry.
Other Stocks to Consider
Other top-ranked stocks in the industry are Altra Industrial Motion Corp. , Colfax Corporation and Barnes Group Inc. (B - Free Report) . While both Altra Industrial Motion and Colfax sport a Zacks Rank #1, Barnes Group carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, earnings estimates for each of these stocks improved for the current year and the next year. The average positive earnings surprise for the last four quarters was 4.01% for Altra Industrial Motion, 7.91% for Colfax and 6.88% for Barnes Group.
Best Electric Car Stock? You'll Never Guess It.
Zacks Research has released a report that may shock many investors. One stock stands out as the best way to invest in the surge to electric cars. And it's not the one you may think!
Much like petroleum 150 years ago, lithium battery power is set to shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, revenues that were already at $31 billion in 2016 are expected to blast to over $67 billion by the end of 2022.
Image: Bigstock
Ingersoll-Rand Worth Buying on Healthy End Markets, Buyouts
We believe that Ingersoll-Rand plc (IR - Free Report) is a solid choice for investors seeking exposure in the industrial machinery space.
The stock, with roughly $25-billion market capitalization, has been upgraded to a Zacks Rank #1 (Strong Buy) on Aug 30. Moreover, the stock’s investment appeal is accentuated by a favorable VGM Score of B.
The company delivered better-than-expected results in three out of the last four quarters, with an average positive earnings surprise of 5.29%.
Why the Upgrade?
We are providing a snapshot of how Ingersoll-Rand fared in second-quarter 2018. The company’s earnings of $1.85 per share surpassed the Zacks Consensus Estimate by 7.56%. Net sales went up 11% year over year on the back of sales growth of 11% in the Climate segment and 13% in the Industrial segment.
In the quarters ahead, Ingersoll-Rand stands to gain from growing popularity of the company’s products and services offered under its two segments — Climate Solutions and Industrial Technologies. Further, businesses in various end markets — including commercial HVAC (heating, ventilation, and air conditioning), residential HVAC, transport, industrial and other — seem to be healthy. Continued investment to boost technological expertise, develop innovative products and business expansion in the Chinese market remains a boon for the company.
Another interesting aspect about Ingersoll-Rand is its acquisitive nature. In this regard, the buyout of ICS Cool Energy in January 2018 is worth mentioning. Since acquired, ICS Cool Energy has been strengthening the company’s commercial HVAC business. Further, the company strongly believes in rewarding shareholders handsomely. Cash of $222 million was used for paying dividends in the first half of 2018 (with 18% hike in quarterly dividend rate announced in June) while shares worth $500 million were repurchased.
For 2018, Ingersoll-Rand has increased its projection for adjusted earnings per share of approximately $5.50 from the earlier guidance of $5.00-$5.20. Organic sales are anticipated to increase 7-8% versus 3-3.5% expected earlier, while total revenues are forecasted to increase 9-10% against the prior prediction of 5-5.5%.
In the past 60 days, the company’s earnings estimates for 2018 and 2019 have been revised upward by eight brokerage firms. The Zacks Consensus Estimate now stands at $5.54 for 2018 and $6.21 for 2019, reflecting growth of 4.7% from the respective 60-day-ago tallies.
Ingersoll-Rand PLC (Ireland) Price and Consensus
Ingersoll-Rand PLC (Ireland) Price and Consensus | Ingersoll-Rand PLC (Ireland) Quote
Moreover, the company’s price performance has been impressive. The stock has yielded a 16.3% return in the past three months, outperforming 7.3% growth recorded by the industry.
Other Stocks to Consider
Other top-ranked stocks in the industry are Altra Industrial Motion Corp. , Colfax Corporation and Barnes Group Inc. (B - Free Report) . While both Altra Industrial Motion and Colfax sport a Zacks Rank #1, Barnes Group carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, earnings estimates for each of these stocks improved for the current year and the next year. The average positive earnings surprise for the last four quarters was 4.01% for Altra Industrial Motion, 7.91% for Colfax and 6.88% for Barnes Group.
Best Electric Car Stock? You'll Never Guess It.
Zacks Research has released a report that may shock many investors. One stock stands out as the best way to invest in the surge to electric cars. And it's not the one you may think!
Much like petroleum 150 years ago, lithium battery power is set to shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge. With battery prices plummeting and charging stations set to multiply, revenues that were already at $31 billion in 2016 are expected to blast to over $67 billion by the end of 2022.
See Zacks Best EV Stock Free >>