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Applied Industrial (AIT) Looks a Solid Bet, Up 8.1% in a Year
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Applied Industrial Technologies, Inc.’s (AIT - Free Report) performance appears in good shape, with its shares having rallied 8.1% over the past year. Strength across the end market, buyouts and strong capital-allocation strategies led to the positive market sentiments around AIT.
This Cleveland, OH-based player, with a $3.9-billion market capitalization, belongs to the Zacks Manufacturing - General Industrial industry. Applied Industrial currently sports a Zacks Rank #1 (Strong Buy).
Image Source: Zacks Investment Research
In the past year, shares of Altra Industrial have outperformed its industry’s decline of 20.1% and the S&P 500’s decrease of 9.1%.
Factors Favoring the Stock
Applied Industrial is poised to gain from its presence in the diverse end markets, which allows it to offset risks associated with a single market. A robust demand environment is likely to benefit AIT’s life sciences, pulp & paper, technology, lumber & wood, off-highway mobile, industrial machinery, metals and other end markets in the quarters ahead. Also, its focus on cross-selling actions and pricing along with growth initiatives are likely to be tailwinds. AIT predicts organic sales growth of 13.6-14.1% and total revenue growth of 14.8-15.3% for fiscal 2022 (ending June 2022) from the corresponding prior fiscal year tallies.
AIT is focused on strengthening its businesses through the addition of assets. The buyout of R.R. Floody (August 2021) enhanced AIT’s automation technology product offerings and expanded its reach across the U.S. Midwest market. Also, acquisitions of Advanced Control Solutions in October 2020 and Gibson in January 2021 added value to its automation solution offerings. In third-quarter fiscal 2022 (ended March 2022) buyouts contributed 0.4% to AIT’s revenues.
Applied Industrial’s focus on improving its product line, cost-saving efforts, initiatives to drive operational excellence and value-added services are likely to improve its financial performance in the quarters ahead. Also, AIT’s investments in customer development initiatives, automation expansion, IIot and digital offerings are expected to be advantageous for AIT over time.
AIT utilizes its cash flow to reward its shareholders through dividend payouts and share-repurchase programs. Applied Industrial paid out dividends worth $38.6 million and repurchased shares worth $13.6 million in the nine months of fiscal 2022. Also, AIT hiked its quarterly dividend rate by 3% in January 2022. It had 318,000 shares left to be repurchased under its share buyback program while exiting the fiscal third quarter.
The Zacks Consensus Estimate for Applied Industrial’s fiscal 2022 earnings of $6.24 has been revised 5.9% upward from the 60-day-ago figure. The consensus estimate for fiscal 2023 (ending June 2023) earnings stands at $6.90, having moved 10.2% north over the same time frame.
Zacks Rank & Stocks to Consider
Some other top-ranked companies from the industrial products sector are discussed below:
ROLL’s earnings estimates have increased 9.8% for fiscal 2023 (ending March 2022) in the past 60 days. Its shares have declined 6.3% over the past year.
Roper Technologies, Inc. (ROP - Free Report) presently has a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 2%, on average.
In the past 60 days, ROP’s earnings estimates have increased 1.2% for 2022. The stock has declined 15.8% over the past year.
Tetra Tech, Inc. (TTEK - Free Report) is presently Zacks #2 Ranked. TTEK’s earnings surprise in the last four quarters was 9.7%, on average.
In the past 60 days, the stock’s earnings estimates have increased 3% for fiscal 2022 (ending September 2022). The same has inched up 4.6% over the past year.
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Applied Industrial (AIT) Looks a Solid Bet, Up 8.1% in a Year
Applied Industrial Technologies, Inc.’s (AIT - Free Report) performance appears in good shape, with its shares having rallied 8.1% over the past year. Strength across the end market, buyouts and strong capital-allocation strategies led to the positive market sentiments around AIT.
This Cleveland, OH-based player, with a $3.9-billion market capitalization, belongs to the Zacks Manufacturing - General Industrial industry. Applied Industrial currently sports a Zacks Rank #1 (Strong Buy).
Image Source: Zacks Investment Research
In the past year, shares of Altra Industrial have outperformed its industry’s decline of 20.1% and the S&P 500’s decrease of 9.1%.
Factors Favoring the Stock
Applied Industrial is poised to gain from its presence in the diverse end markets, which allows it to offset risks associated with a single market. A robust demand environment is likely to benefit AIT’s life sciences, pulp & paper, technology, lumber & wood, off-highway mobile, industrial machinery, metals and other end markets in the quarters ahead. Also, its focus on cross-selling actions and pricing along with growth initiatives are likely to be tailwinds. AIT predicts organic sales growth of 13.6-14.1% and total revenue growth of 14.8-15.3% for fiscal 2022 (ending June 2022) from the corresponding prior fiscal year tallies.
AIT is focused on strengthening its businesses through the addition of assets. The buyout of R.R. Floody (August 2021) enhanced AIT’s automation technology product offerings and expanded its reach across the U.S. Midwest market. Also, acquisitions of Advanced Control Solutions in October 2020 and Gibson in January 2021 added value to its automation solution offerings. In third-quarter fiscal 2022 (ended March 2022) buyouts contributed 0.4% to AIT’s revenues.
Applied Industrial’s focus on improving its product line, cost-saving efforts, initiatives to drive operational excellence and value-added services are likely to improve its financial performance in the quarters ahead. Also, AIT’s investments in customer development initiatives, automation expansion, IIot and digital offerings are expected to be advantageous for AIT over time.
AIT utilizes its cash flow to reward its shareholders through dividend payouts and share-repurchase programs. Applied Industrial paid out dividends worth $38.6 million and repurchased shares worth $13.6 million in the nine months of fiscal 2022. Also, AIT hiked its quarterly dividend rate by 3% in January 2022. It had 318,000 shares left to be repurchased under its share buyback program while exiting the fiscal third quarter.
The Zacks Consensus Estimate for Applied Industrial’s fiscal 2022 earnings of $6.24 has been revised 5.9% upward from the 60-day-ago figure. The consensus estimate for fiscal 2023 (ending June 2023) earnings stands at $6.90, having moved 10.2% north over the same time frame.
Zacks Rank & Stocks to Consider
Some other top-ranked companies from the industrial products sector are discussed below:
RBC Bearings Incorporated presently has a Zacks Rank of 1. ROLL delivered a trailing four-quarter earnings surprise of 3.4%, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ROLL’s earnings estimates have increased 9.8% for fiscal 2023 (ending March 2022) in the past 60 days. Its shares have declined 6.3% over the past year.
Roper Technologies, Inc. (ROP - Free Report) presently has a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 2%, on average.
In the past 60 days, ROP’s earnings estimates have increased 1.2% for 2022. The stock has declined 15.8% over the past year.
Tetra Tech, Inc. (TTEK - Free Report) is presently Zacks #2 Ranked. TTEK’s earnings surprise in the last four quarters was 9.7%, on average.
In the past 60 days, the stock’s earnings estimates have increased 3% for fiscal 2022 (ending September 2022). The same has inched up 4.6% over the past year.