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SiteOne Landscape (SITE) Gains 26% in 3 Months: Here's Why
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Shares of SiteOne Landscape Supply, Inc. (SITE - Free Report) have gained an impressive 25.7% in the past three months. Solid product offerings, better-than-expected financial performance and healthy growth opportunities have added to SITE’s attractiveness. It presently sports a Zacks Rank #1 (Strong Buy).
SiteOne Landscape engages in distributing landscape supplies for use in golf courses, outdoor spaces, lawns and gardens. It has a solid customer base in Canada and the United States and primarily includes landscape professionals, both from commercial and residential markets. The company is based in Roswell, GA, and has a market capitalization of $11.3 billion.
The company belongs to the Zacks Industrial Services industry, which comes under the ambit of the Zacks Industrial Products sector. The industry is in the top 41% (with rank of 104) among more than 250 Zacks industries. In the past three months, the industry has declined 11.2%. The S&P 500 has gained 4.1% during the same period while the sector has lost 0.5%.
Image Source: Zacks Investment Research
Factors Influencing the Stock
In the past three months, SiteOne Landscape reported better-than-expected results in the third quarter of 2021. Its earnings surpassed the Zacks Consensus Estimate by 41.46% and increased 61.1% from the year-ago quarter. Healthy sales growth and margin improvements supported the bottom line.
In addition to the solid financial performance, strengthening demand for landscaping services and products, benefits from operational and commercial operations and a wide customer base are beneficial for SiteOne Landscape. Solid backlog and synergistic gains from acquired assets (detailed below) too are tailwinds.
For 2021, SiteOne Landscape predicts adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to be $380-$400 million, above the previously stated $335-$365 million. The revised projection reflects year-over-year growth of 46-54%. SITE also predicts growth in adjusted EBITDA margin.
Regarding buyout actions, SiteOne Landscape has made seven acquisitions so far in 2021. Its latest deal is the Semco Stone, LLC acquisition (on Nov 15).
In the first three quarters of 2021, SITE invested $71.1 million for purchasing businesses (net of acquired cash). Buyouts boosted sales by $73.5 million (or 10% on a year-over-year basis) in the third quarter.
The Zacks Consensus Estimate for SiteOne Landscape’s earnings per share is pegged at $4.87 for 2021 and $5.17 for 2022, marking increases of 13.8% and 13.4% from the respective 30-day-ago figures. Also, the consensus mark for the fourth quarter of 27 cents per share has jumped 50% over the past 30 days. Such upward revisions in earnings estimates reflect the company’s healthy operating conditions.
SiteOne Landscape Supply, Inc. Price and Consensus
Three other top-ranked stocks from the sector are discussed below.
Shares of Heritage-Crystal Clean, Inc. have gained 17.8% in the past three months. HCCI’s performance in the last reported quarter was impressive, with an earnings beat of 33.90%.
In the past 30 days, the Zacks Consensus Estimate for Heritage-Crystal’s earnings has been unchanged for 2021 and 2022. The company presently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Global Industrial Company’s (GIC - Free Report) shares have gained 11.3% in the past three months. GIC’s results in the last quarter were better than expected, with earnings surpassing estimates by 1.67%.
In the past 30 days, the Zacks Consensus Estimate for Global Industrial’s earnings has increased 1.2% for 2021 and 10.1% for 2022. The GIC stock presently carries a Zacks Rank #2.
Shares of ScanSource, Inc. (SCSC - Free Report) have decreased 6.3% in the past three months. SCSC’s performance in the last reported quarter was impressive, with an earnings beat of 32.00%.
In the past 30 days, the Zacks Consensus Estimate for Helios Technologies’ earnings has increased 0.9% for fiscal 2022 (ending June 2022) and 2.2% for fiscal 2023 (ending June 2023). The company presently carries a Zacks Rank #2.
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SiteOne Landscape (SITE) Gains 26% in 3 Months: Here's Why
Shares of SiteOne Landscape Supply, Inc. (SITE - Free Report) have gained an impressive 25.7% in the past three months. Solid product offerings, better-than-expected financial performance and healthy growth opportunities have added to SITE’s attractiveness. It presently sports a Zacks Rank #1 (Strong Buy).
SiteOne Landscape engages in distributing landscape supplies for use in golf courses, outdoor spaces, lawns and gardens. It has a solid customer base in Canada and the United States and primarily includes landscape professionals, both from commercial and residential markets. The company is based in Roswell, GA, and has a market capitalization of $11.3 billion.
The company belongs to the Zacks Industrial Services industry, which comes under the ambit of the Zacks Industrial Products sector. The industry is in the top 41% (with rank of 104) among more than 250 Zacks industries. In the past three months, the industry has declined 11.2%. The S&P 500 has gained 4.1% during the same period while the sector has lost 0.5%.
Factors Influencing the Stock
In the past three months, SiteOne Landscape reported better-than-expected results in the third quarter of 2021. Its earnings surpassed the Zacks Consensus Estimate by 41.46% and increased 61.1% from the year-ago quarter. Healthy sales growth and margin improvements supported the bottom line.
In addition to the solid financial performance, strengthening demand for landscaping services and products, benefits from operational and commercial operations and a wide customer base are beneficial for SiteOne Landscape. Solid backlog and synergistic gains from acquired assets (detailed below) too are tailwinds.
For 2021, SiteOne Landscape predicts adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) to be $380-$400 million, above the previously stated $335-$365 million. The revised projection reflects year-over-year growth of 46-54%. SITE also predicts growth in adjusted EBITDA margin.
Regarding buyout actions, SiteOne Landscape has made seven acquisitions so far in 2021. Its latest deal is the Semco Stone, LLC acquisition (on Nov 15).
In the first three quarters of 2021, SITE invested $71.1 million for purchasing businesses (net of acquired cash). Buyouts boosted sales by $73.5 million (or 10% on a year-over-year basis) in the third quarter.
The Zacks Consensus Estimate for SiteOne Landscape’s earnings per share is pegged at $4.87 for 2021 and $5.17 for 2022, marking increases of 13.8% and 13.4% from the respective 30-day-ago figures. Also, the consensus mark for the fourth quarter of 27 cents per share has jumped 50% over the past 30 days. Such upward revisions in earnings estimates reflect the company’s healthy operating conditions.
SiteOne Landscape Supply, Inc. Price and Consensus
SiteOne Landscape Supply, Inc. price-consensus-chart | SiteOne Landscape Supply, Inc. Quote
Other Stocks to Consider
Three other top-ranked stocks from the sector are discussed below.
Shares of Heritage-Crystal Clean, Inc. have gained 17.8% in the past three months. HCCI’s performance in the last reported quarter was impressive, with an earnings beat of 33.90%.
In the past 30 days, the Zacks Consensus Estimate for Heritage-Crystal’s earnings has been unchanged for 2021 and 2022. The company presently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Global Industrial Company’s (GIC - Free Report) shares have gained 11.3% in the past three months. GIC’s results in the last quarter were better than expected, with earnings surpassing estimates by 1.67%.
In the past 30 days, the Zacks Consensus Estimate for Global Industrial’s earnings has increased 1.2% for 2021 and 10.1% for 2022. The GIC stock presently carries a Zacks Rank #2.
Shares of ScanSource, Inc. (SCSC - Free Report) have decreased 6.3% in the past three months. SCSC’s performance in the last reported quarter was impressive, with an earnings beat of 32.00%.
In the past 30 days, the Zacks Consensus Estimate for Helios Technologies’ earnings has increased 0.9% for fiscal 2022 (ending June 2022) and 2.2% for fiscal 2023 (ending June 2023). The company presently carries a Zacks Rank #2.