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Robbins & Myers, Inc.

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There's no slowdown in the energy sector. Robbins & Myers, Inc. (RBN) recently reported strong fiscal second quarter results that surprised on the Zacks Consensus by 13.5%. This Zacks #1 Rank (Strong Buy) is a value stock with a P/B ratio of 2.2.

The industrial manufacturers are on the front line of the global economic recovery. Robbins & Myers makes engineered equipment and systems for the energy, industrial, chemical and pharmaceutical markets. Headquartered in Texas, it is a global company with operations in 15 countries.

Robbins & Myers Beat for the Third Quarter in a Row

On Mar 27, Robbins & Myers reported fiscal second quarter results and easily beat the Zacks Consensus Estimate by 10 cents. Earnings were 84 cents compared to the consensus of 74 cents. The company made just 58 cents in the year ago quarter.

Sales rose 39% to $256 million from $184 million a year ago. However, excluding currency translation and the acquisition of T-3 Energy Services, sales grew 24% year over year.

Excluding the acquisition and currency translation, new orders rose 35% compared to the prior year quarter.

The backlog also rose to $301 million from $260 million at the end of the prior quarter and $221 million at the end of the same quarter a year ago.

Each of its business units saw improved profitability, mainly due to additional volume, benefits of the acquisition and cost savings in the Process & Flow Control segment.

Energy Sector Remains Hot

Robbins & Myers continues to see strong demand from the energy sector despite weakness due to low natural gas prices. That weakness is being offset by demand from the oil sector which remains hot.

Sales rose 36% to $168 million in the Energy Services segment compared to last year. Orders jumped 55% year over year, excluding the acquisition of T-3.

Sales in the Process & Flow Control segment jumped 17% on improving demand for capital goods in some regional chemical markets.

Fiscal 2012 Guidance Raised

The company is bullish about the rest of fiscal 2012.

It raised its forecast to a range of $3.40 to $3.60 per share from $3.00 to $3.20 per share.

The analysts are optimistic as well. 7 estimates moved higher in the last week pushing the Fiscal 2012 Zacks Consensus Estimate to $3.56 from $3.20.

That is earnings growth of 81.4%.

Where's the Value?

Shares are trading near 2-year highs.

Even with the earnings growth, the stock isn't the cheapest one out there.

It has a forward P/E of 15, which is just on the edge of the cut-off I use for value which is, actually, 15x. It is also higher than the average P/E of the S&P 500 which is 13.7.

BUT, Robbins & Myers has a price-to-book ratio of 2.2, which is under the 3.0 cut-off I use for value stocks. So it does have several value characteristics.

Shareholders are also rewarded with a small dividend, currently yielding 0.4%.

But you're not buying into this company for the dividend. You're buying big growth at an attractive valuation.

Tracey Ryniec is the Value Stock Strategist for She is also the Editor of the Turnaround Trader and Insider Trader services. You can follow her on twitter at @TraceyRyniec.

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