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Rockwood Holdings

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Rockwood Holdings, Inc. (ROC) analysts are expecting big growth rate from this Zacks #1 Rank (Strong Buy).

And even though the share price is significantly higher, rising estimates have kept valuations in line.

Company Description

Rockwood Holdings is a specialty and advanced materials maker. The company operates on a global scale and focuses on niche markets in the specialty chemicals, pigments and additives and advanced materials segments.

Another Strong Quarter

On Apr 27 Rockwood said first quarter revenues were up 17.4%, to $914 million. Additionally, they expect that sales will continue to increase in the near future.

Coupled with strong margins, that led to earnings per share $0.88, which was more than double the same period last year and 27 cents higher than the Zacks Consensus Estimate. Rockwood now has 7 consecutive earnings surprises.

More Growth Ahead

Granted the news release was just over a month ago, but the company said it is optimistic about the prospects and see demand continuing to improve.

Analysts showed that they agree, raising estimates across the board. The consensus estimate for 2011 is up 72 cents, to $3.55. Next year's average estimate is up 72 cents as well, to $4.17. Given EPS in 2010 of $2.08, the expected annual growth rates are now 70% and 17%, respectively.

Slow and Steady

While the sector has been a bit volatile lately, if you take a step back you can see the slow and steady increases in share price since ROC was last featured as a Zacks Rank Buy in August.

Even with the big price increase, shares are still just 14 times forward earnings thanks to increasingly bullish forecasts.

Read the August 16th Feature Here

Rockwood Holdings - ticker ROC >

Bill Wilton is the Aggressive Growth Stock Strategist for He is also the Editor in charge of the Zacks Small Cap Trader service

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