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Anatomy of Success: Harsco Corporation (HSC)

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Here at Zacks, we seek to provide investors—whether they are just starting out or have many years of experience—with the best tools to identify strong stocks at any given moment. Our preferred model is the Zacks Rank, a system which emphasizes the power earnings estimate revisions in determining share price momentum.

When the Zacks Rank flags a particular company as a #1 (Strong Buy), we know that stock is displaying the right characteristics to outperform the market over the next one to three months. But of course, reaching this ideal rank is not an easy feat. Of the thousands of companies tracked by Zacks, only about 5% earn this designation.

In the story below, you will learn about one particular company that helped show the strength of the Zacks Rank. If investors had followed our ranking system when it flagged this industrial services firm, they would have witnessed massive profits.

Harsco Corporation (HSC - Free Report)

Harsco is a services and engineered products company. It provides mill services to steel and non-ferrous metal producers, gas control and containment products, scaffolding services, and railway maintenance equipment. 

HSC has been flagged by the Zacks Rank a number of times over the past year. Exactly one year ago, the stock was holding a #2 (Buy), having held that position for several weeks in the wake of a strong quarterly earnings report. In that report, Harsco notched adjusted earnings growth of a staggering 450%, topping estimates by nine cents and highlighting its strengthening profit position.

The stock would remain a #2 (Buy) for another few weeks. It never dipped below a #3 (Hold) and would eventually join the #2 (Buy) list again Aug. 4. It would stay in that position for eight consecutive weeks. HSC would earn another #2 (Buy) designation on Nov. 11, again holding that ranking for eight straight calendar weeks.

HSC earned its first #1 (Strong Buy) of the past year in January. This top ranking came as investors and analysts geared up for its impending earnings report date, which was due about a month later. Harsco delivered on those expectations once again, topping EPS estimates on the back of 25% earnings growth. Quarterly revenue also expanded by 26% and beat expectations in that period.

HSC would hold on to its #1 (Strong Buy) ranking for a staggering 14 weeks. It has yet to dip below a #3 (Hold) within the trailing 52 weeks and is currently holding a #1 (Strong Buy) again.

The below chart demonstrates the price performance for HSC and 12-month forward EPS estimate (in red), starting from about this time last year.

As we can see, HSC was a massive winner for those that followed the Zacks Rank. The stock has gained about 65% over the last year.

Want more market analysis from this author? Make sure to follow @Ryan_McQueeney on Twitter!

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