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Don't Overlook These Top-Rated Stocks Before Earnings
In a shortened and fairly quiet week in regards to the earnings lineup, a few top-rated Zacks stocks are standing out before their quarterly results.
As investors await earnings from Microsoft (MSFT - Free Report) and Netflix (NFLX - Free Report) next week, 1ST Source (SRCE - Free Report) and Fastenal (FAST - Free Report) are two companies that shouldn’t be overlooked ahead of their fourth quarter reports on Thursday, January 18.
Fastenal Q4 Preview & Overview
Fastenal is one of the most appealing retailers at the moment as a national wholesale distributor of industrial and construction supplies. Infrastructure and construction-related activities including homebuilding have continued to thrive with Fastenal’s stock up +32% over the last year to easily top the Zacks Building Products-Retail Markets’+10% and the S&P 500’s +20%.
Image Source: Zacks Investment Research
For the fourth quarter, Fastenal’s earnings are expected to be up 4% year over year to $0.45 a share with sales projected to rise 3% to $1.75 billion. Overall, Fastenal is expected to round out fiscal 2023 with annual earnings up 6% to $2.00 a share and total sales up 5% to $7.34 billion. Even better, Fastenal is projected to have another 6% growth on its top and bottom lines in FY24. Fastenal also offers investors a generous 2.20% annual dividend yield.
Image Source: Zacks Investment Research
1st Source Q4 Preview & Overview
Ahead of its Q4 results, 1ST Source is a regional bank enjoying positive earnings estimate revisions with general banking branches throughout Indiana and Michigan.1ST Source’s stock is down -5% in the last year but looks attractive at a 12.3X forward earnings multiple which is near the Zacks Banks-Midwest Industry average of 10.6X and well below the S&P 500’s 20X. 1ST Source's 2.63% annual dividend yield also bolsters its more attrctive valuation.
Image Source: Zacks Investment Research
1ST Source’s stock appears to have already priced in Q4 earnings being forecasted to dip -10% YoY to $1.12 a share with sales expected to be down -4% to $91.2 million. Also rounding out its FY23, annual earnings are still projected to rise 4% to $5.02 per share but are expected to dip to $4.20 a share in FY24.
However, over the last 60 days, FY24 earnings estimates are up 3% while FY23 EPS estimates have risen 6%. Total sales are now slated to rise 4% in FY23 and then dip -3% this year to $356.7 million but 1ST Source’s price-to-sales ratio of 2.6X is closing in on the optimum level of less than 2X.
Image Source: Zacks Investment Research
Takeaway
Fastenal and 1ST Source look like two stocks that could rally if they post favorable Q4 results and guidance. At the moment, 1ST Source’s stock covets a Zacks Rank #1 (Strong Buy) in correlation with its attractive valuation and rising earnings estimates while Fastenal’s stock sports a Zacks Rank #2 (Buy) and remains a very intriguing option for growth.
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Don't Overlook These Top-Rated Stocks Before Earnings
In a shortened and fairly quiet week in regards to the earnings lineup, a few top-rated Zacks stocks are standing out before their quarterly results.
As investors await earnings from Microsoft (MSFT - Free Report) and Netflix (NFLX - Free Report) next week, 1ST Source (SRCE - Free Report) and Fastenal (FAST - Free Report) are two companies that shouldn’t be overlooked ahead of their fourth quarter reports on Thursday, January 18.
Fastenal Q4 Preview & Overview
Fastenal is one of the most appealing retailers at the moment as a national wholesale distributor of industrial and construction supplies. Infrastructure and construction-related activities including homebuilding have continued to thrive with Fastenal’s stock up +32% over the last year to easily top the Zacks Building Products-Retail Markets’+10% and the S&P 500’s +20%.
Image Source: Zacks Investment Research
For the fourth quarter, Fastenal’s earnings are expected to be up 4% year over year to $0.45 a share with sales projected to rise 3% to $1.75 billion. Overall, Fastenal is expected to round out fiscal 2023 with annual earnings up 6% to $2.00 a share and total sales up 5% to $7.34 billion. Even better, Fastenal is projected to have another 6% growth on its top and bottom lines in FY24. Fastenal also offers investors a generous 2.20% annual dividend yield.
Image Source: Zacks Investment Research
1st Source Q4 Preview & Overview
Ahead of its Q4 results, 1ST Source is a regional bank enjoying positive earnings estimate revisions with general banking branches throughout Indiana and Michigan.1ST Source’s stock is down -5% in the last year but looks attractive at a 12.3X forward earnings multiple which is near the Zacks Banks-Midwest Industry average of 10.6X and well below the S&P 500’s 20X. 1ST Source's 2.63% annual dividend yield also bolsters its more attrctive valuation.
Image Source: Zacks Investment Research
1ST Source’s stock appears to have already priced in Q4 earnings being forecasted to dip -10% YoY to $1.12 a share with sales expected to be down -4% to $91.2 million. Also rounding out its FY23, annual earnings are still projected to rise 4% to $5.02 per share but are expected to dip to $4.20 a share in FY24.
However, over the last 60 days, FY24 earnings estimates are up 3% while FY23 EPS estimates have risen 6%. Total sales are now slated to rise 4% in FY23 and then dip -3% this year to $356.7 million but 1ST Source’s price-to-sales ratio of 2.6X is closing in on the optimum level of less than 2X.
Image Source: Zacks Investment Research
Takeaway
Fastenal and 1ST Source look like two stocks that could rally if they post favorable Q4 results and guidance. At the moment, 1ST Source’s stock covets a Zacks Rank #1 (Strong Buy) in correlation with its attractive valuation and rising earnings estimates while Fastenal’s stock sports a Zacks Rank #2 (Buy) and remains a very intriguing option for growth.