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Cabot (CBT) Shares Up 18% YTD: What's Driving the Stock?
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Cabot Corporation (CBT - Free Report) shares have jumped 17.7% year to date, outperforming the industry’s rise of 10.8%. The company is benefiting from its growth actions and strong demand across regions and end markets, which also led to an impressive fiscal third-quarter performance.
Image Source: Zacks Investment Research
Let’s dive into the factors behind this Zacks Rank #2 (Buy) stock’s price appreciation.
What’s Favoring Cabot?
Impressive results in the fiscal third quarter and upbeat prospects have contributed to the surge in Cabot’s share price. Its adjusted earnings of $1.35 per share in the fiscal third quarter beat the Zacks Consensus Estimate of $1.19. Its top line climbed 77% year over year to $917 million, and beat the Zacks Consensus Estimate of $843.6 million.
The robust performance was on the back of continued strong demand, global footprint and operational excellence. The company saw strong results in the Reinforcement Materials and Performance Chemical segments. Higher volumes across all regions and key end markets, a strong pricing in Asia and a solid demand from automotive applications mainly led the upside. Moreover, targeted growth initiatives have brought in higher sales, including new adoptions at leading battery customers. Cabot expects volumes to remain healthy in the fiscal fourth quarter as well.
The company increased guidance for adjusted earnings per share for fiscal 2021 to $4.85-$5.05 from the prior expectation of $4.70-$4.95 and believes that it is well-positioned for fiscal 2022.
Earnings estimates for Cabot have also been going up over the past three months with the Zacks Consensus Estimate for earnings increasing 5.5% for fiscal 2021 and 11.9% for fiscal 2022. The favorable estimate revisions instill investors’ confidence in the stock.
Image: Bigstock
Cabot (CBT) Shares Up 18% YTD: What's Driving the Stock?
Cabot Corporation (CBT - Free Report) shares have jumped 17.7% year to date, outperforming the industry’s rise of 10.8%. The company is benefiting from its growth actions and strong demand across regions and end markets, which also led to an impressive fiscal third-quarter performance.
Image Source: Zacks Investment Research
Let’s dive into the factors behind this Zacks Rank #2 (Buy) stock’s price appreciation.
What’s Favoring Cabot?
Impressive results in the fiscal third quarter and upbeat prospects have contributed to the surge in Cabot’s share price. Its adjusted earnings of $1.35 per share in the fiscal third quarter beat the Zacks Consensus Estimate of $1.19. Its top line climbed 77% year over year to $917 million, and beat the Zacks Consensus Estimate of $843.6 million.
The robust performance was on the back of continued strong demand, global footprint and operational excellence. The company saw strong results in the Reinforcement Materials and Performance Chemical segments. Higher volumes across all regions and key end markets, a strong pricing in Asia and a solid demand from automotive applications mainly led the upside. Moreover, targeted growth initiatives have brought in higher sales, including new adoptions at leading battery customers. Cabot expects volumes to remain healthy in the fiscal fourth quarter as well.
The company increased guidance for adjusted earnings per share for fiscal 2021 to $4.85-$5.05 from the prior expectation of $4.70-$4.95 and believes that it is well-positioned for fiscal 2022.
Earnings estimates for Cabot have also been going up over the past three months with the Zacks Consensus Estimate for earnings increasing 5.5% for fiscal 2021 and 11.9% for fiscal 2022. The favorable estimate revisions instill investors’ confidence in the stock.
Cabot Corporation Price and Consensus
Cabot Corporation price-consensus-chart | Cabot Corporation Quote
Other Stocks to Consider
Some other top-ranked stocks in the basic materials space are BASF SE (BASFY - Free Report) and Avient Corporation (AVNT - Free Report) , each flaunting a Zacks Rank #1 (Strong Buy) and Dow Inc. (DOW - Free Report) , carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
BASF has a projected earnings growth rate of 96.7% for the current year. The company’s shares have rallied 26.5% in a year.
Avient has a projected earnings growth rate of 75.1% for the current year. The company’s shares have jumped 89.8% in a year.
Dow has a projected earnings growth rate of 403% for the current year. The company’s shares have jumped 38.3% in a year.