For Immediate Release
Chicago, IL – February 25, 2022 – Zacks Equity Research shares Golar LNG Limited (
GLNG Quick Quote GLNG - Free Report) as the Bull of the Day and American Woodmark ( AMWD Quick Quote AMWD - Free Report) asthe Bear of the Day. In addition, Zacks Equity Research provides analysis on Popular, Inc. ( BPOP Quick Quote BPOP - Free Report) , Midland States Bancorp, Inc. ( MSBI Quick Quote MSBI - Free Report) and HomeStreet, Inc. ( HMST Quick Quote HMST - Free Report) .
Here is a synopsis of all five stocks:
: Bull of the Day
Inflation is a double-edged sword, no question about it. For some, it has been an absolute boon. For others, it is a scourge. Most of us go about our lives never thinking about inflation…until it hits. There is no question that inflation is hitting us now. The secret to success becomes looking for stocks in industries which benefit from the big CPI numbers. One area has been in energy, where oil and natural gas prices have risen dramatically since mid-2020.
Today’s Bull of the Day is a stock in the natural gas business. I’m talking about Zacks Rank #1 (Strong Buy)
Golar LNG Limited. Golar LNG Limited provides infrastructure for the liquefaction, transportation, and regasification of LNG. It operates through Shipping, FLNG, and Power segments. The company engages in the acquisition, ownership, operation, and chartering of LNG carriers, Floating Liquefaction Natural Gas Vessel (FLNG), and floating storage regasification units (FSRUs), as well as operates external vessels. As of April 16, 2021, it operated ten LNG carriers, one FSRU, and two FLNGs.
Over the course of the last sixty days, two analysts have increased their earnings estimates for next year while one has done so for the current year. That has pushed up the Zacks Consensus Estimate for the current year from a 3-cent loss to a 2-cent loss while next year’s number is up from a 38-cent profit to a 41-cent profit. That is likely to change as the stock just reported earnings this morning. The company reported Q4 net of $44.6 million on revenues of $115 million.
This is a stock that traded down in the $5 level in early 2020. If you look back on the Price, Consensus and EPS Surprise Chart, you can see how the earnings trend was terrible back then. The company would constantly over-promise and under deliver. That trend reversed in the middle of 2021. Since then, estimates have ticked on upwards, helping to underpin the rally in the stock.
Bear of the Day:
Do not let a small rally distract you from long-term success. Over the long run, it’s companies with the strongest earnings that can stand the test of time. One way to find these companies is by leaning on the Zacks Rank. Stocks in the good graces of the Zacks Rank have the strongest earnings trends. Those with lower ranks have the opposite. Today’s Bear of the Day is a stock that has seen its earnings trend push to the downside. That could be the reason why the stock’s price has come under so much pressure.
Today’s Bear of the Day is Zacks Rank #5 (Strong Sell)
American Woodmark . American Woodmark manufactures and distributes kitchen, bath, and home organization products for the remodelling and new home construction markets in the United States. It offers made-to-order and cash and carry products. The company also provides turnkey installation services to its direct builder customers through a network of eight service centers. American Woodmark Corporation sells its products under the American Woodmark, Timberlake, Shenandoah Cabinetry, Waypoint Living Spaces, Estate by RSI, Continental Cabinets, VillaBath by RSI, Stor-It-All, and Professional Cabinet Solutions brands, as well as Hampton Bay, Glacier Bay, Style Selections, Allen + Roth, Home Decorators Collection, and Project Source.
The earnings picture has continued to weaken for AMWD. Over the last week, analysts have come out and cut their estimates for the current year and next year. The negative revisions have cut our Zacks Consensus Estimates for the current year from $3.82 to $3.10 while next year’s number is off from $6.85 to $6.13. At first glance, the 97% EPS growth for next year looks amazing. When you zoom out another year, then you see the trouble. Current year EPS is forecast to contract 51% from the year before. Add up a 51% contraction, met with a big growth number and you are still behind where the earnings were before you started.
Revenue growth has been steady at 7% for the current year and next year. That is a big plus for the long-term investors who are toughing it out during this stretch.
The Furniture industry ranks in the Bottom 3% of our Zacks Industry Rank. Currently, there are no stocks in the good graces of the Zacks Rank in this entire industry.
Additional content: Is Popular ( BPOP Quick Quote BPOP - Free Report) Stock Worth Buying on 25% Dividend Hike?
As previously intended by management,
Popular, Inc. has announced a dividend hike. The company declared a quarterly cash dividend of 55 cents per share, reflecting a rise of 25% from the prior payout. The dividend will be paid out on Apr 1 to shareholders on record as of Mar 15.
This marks the fourth consecutive annual dividend hike by the company. Prior to this, Popular hiked its dividend by 12.5% to 45 cents per share in May 2021. We believe that such disbursements highlight the company’s operational strength and commitment toward enhancing shareholder wealth.
Considering the last day’s closing price of $88.89, Popular’s dividend yield currently stands at 2.47%. Not only is the yield attractive for income investors, but also it represents a steady income stream. Also, the yield is significantly impressive compared with the industry average of 1.79%.
Apart from regular dividend payments, the company has a share repurchase program in place. This January, Popular announced a $500 worth buyback authorization for 2022.
Investors are always on the lookout for companies with a track record of consistent and incremental dividend payments to bet their money on. While this favorable development makes BPOP stock attractive to investors, let’s check whether it is worth investing to earn this dividend income. Deeper research into the bank’s financial performance and fundamentals will help understand the risks and rewards.
Popular boasts a solid balance sheet. As of Dec 31, 2021, the company had total debt worth $1.06 billion and cash and cash equivalents of $428.4 million. Of the total debt, only $0.8 million is short-term in nature. Thus, given a robust liquidity position and decent earnings strength, the company’s capital deployment activities are likely to remain sustainable.
Also, BPOP’s operations are likely to lend support. The company’s revenues witnessed a compound annual growth rate (CAGR) of 7.9% over the last five years (ended 2021). Given a strong balance sheet position, the company is expected to expand into lucrative businesses. Further, it evaluates its branch network and realigns business per customer needs.
These efforts are expected to continue supporting the top line. BPOP’s 2022 revenues are projected to grow almost 1%, whereas 2023 revenues will likely rise 4.3%.
Further, Popular witnessed earnings growth of 32.3% in the past three to five years, higher than the industry average of 14.2%. Though earnings are expected to decline 17.8% this year, the same is expected to bounce back and grow 5.1% in 2023.
Also, the Zacks Consensus Estimate for the company’s earnings has been revised 12.7% and 10.6% upward for 2022 and 2023, respectively, over the past 30 days. This shows that analysts are optimistic regarding the company’s earnings growth potential.
Shares of this Zacks Rank #1 (Strong Buy) bank have rallied 16.7% over the past six months, outperforming the
industry’s 8.2% rise. You can see . the complete list of today’s Zacks #1 Rank stocks here
However, pressure on margins amid relatively low-interest rates remains a major near-term concern for Popular. Continuously increasing costs is another major drag.
Other Banks Taking Similar Steps
Over the past few months, several banks have rewarded their shareholders with dividend hikes. Some of these are
Midland States Bancorp, Inc. and HomeStreet, Inc..
MSBI declared a quarterly cash dividend of 29 cents per share, up 3.6% from the prior payout. The dividend was paid out on Feb 18 to all its shareholders of record on Feb 11.
This increase represents the 22nd consecutive annual hike in Midland States’ quarterly cash dividend. Prior to this, MSBI had announced a 4.5% dividend hike to 28 cents per share in November 2021.
HMST declared a quarterly dividend of 35 cents per share, representing a hike of 40% from the prior payout. The dividend was paid out on Feb 23 to its shareholders on record as of Feb 9.
This marks the third dividend hike by HomeStreet. HMST had earlier increased its dividend by 66.7% to 25 cents per share in February 2021.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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