Hitachi Ltd. (HTHIY - Free Report) announced its decision to acquire software company GlobalLogic Inc. The deal, which is expected to be completed by July-end, is valued at $9.6 billion including debt repayment.
The company expects to fund the transaction with the help of cash and bank loans.
It is worth noting here that Hitachi’s shares lost 5.6% yesterday to eventually close the trading session at $92.45.
Inside the Headlines
Based in San Jose, CA, GlobalLogic is a leading provider of software engineering services in several industries like healthcare, automotive and finance. The company, which has operational presence across 14 countries, provides services to 400 clients.
The addition of GlobalLogic’s expertise in software product development services will enable Hitachi to expand its digital services business.
Other Buyout Activities
It’s worth noting here that the buyout is in sync with Hitachi's current business portfolio restructuring program. Also, in July 2020, the company acquired the Power Grids business of ABB Ltd , which is likely to help it in expanding into the power grid industry. Notably, in the first nine months of fiscal 2021 (ended December 2020), the company’s net cash used in investing activities totaled $7,366 million.
Zacks Rank, Price Performance and Earnings Trend
The company, with $44.8-billion market capitalization, currently carries a Zacks Rank #3 (Hold). It is likely to benefit from solid product offerings, acquired assets and planned investments.
Hitachi’s shares have gained 16.4% compared with 7.4% growth recorded by the industry in the past three months.
The Zacks Consensus Estimate for its fourth-quarter fiscal 2021 (ended March 2021, results are awaited) earnings has declined 1.7% to 57 cents in the past 60 days. However, estimates for fiscal 2022 (ending March 2022) have increased 12.5% to $7.63 during the same period.
Key Picks
A couple of better-ranked stocks from the same space are Crane Co. (CR - Free Report) and Griffon Corporation (GFF - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Crane delivered a positive earnings surprise of 12.37%, on average, in the trailing four quarters.
Griffon delivered a positive earnings surprise of 115.48%, on average, in the trailing four quarters.
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It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
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Hitachi Ltd. (HTHIY - Free Report) announced its decision to acquire software company GlobalLogic Inc. The deal, which is expected to be completed by July-end, is valued at $9.6 billion including debt repayment.
The company expects to fund the transaction with the help of cash and bank loans.
It is worth noting here that Hitachi’s shares lost 5.6% yesterday to eventually close the trading session at $92.45.
Inside the Headlines
Based in San Jose, CA, GlobalLogic is a leading provider of software engineering services in several industries like healthcare, automotive and finance. The company, which has operational presence across 14 countries, provides services to 400 clients.
The addition of GlobalLogic’s expertise in software product development services will enable Hitachi to expand its digital services business.
Other Buyout Activities
It’s worth noting here that the buyout is in sync with Hitachi's current business portfolio restructuring program. Also, in July 2020, the company acquired the Power Grids business of ABB Ltd , which is likely to help it in expanding into the power grid industry. Notably, in the first nine months of fiscal 2021 (ended December 2020), the company’s net cash used in investing activities totaled $7,366 million.
Zacks Rank, Price Performance and Earnings Trend
The company, with $44.8-billion market capitalization, currently carries a Zacks Rank #3 (Hold). It is likely to benefit from solid product offerings, acquired assets and planned investments.
Hitachi’s shares have gained 16.4% compared with 7.4% growth recorded by the industry in the past three months.
The Zacks Consensus Estimate for its fourth-quarter fiscal 2021 (ended March 2021, results are awaited) earnings has declined 1.7% to 57 cents in the past 60 days. However, estimates for fiscal 2022 (ending March 2022) have increased 12.5% to $7.63 during the same period.
Key Picks
A couple of better-ranked stocks from the same space are Crane Co. (CR - Free Report) and Griffon Corporation (GFF - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Crane delivered a positive earnings surprise of 12.37%, on average, in the trailing four quarters.
Griffon delivered a positive earnings surprise of 115.48%, on average, in the trailing four quarters.
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 77 billion devices by 2025, creating a $1.3 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.
Click here for the 4 trades >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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