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Carlisle (CSL) Appears to be a Solid Bet, Up 30.2% in a Year

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Carlisle Companies Incorporated (CSL - Free Report) appears in good shape, with its shares rallying 30.2% over the past year. Strength across end markets, buyouts and robust capital-allocation strategies led to the positive market sentiments for the company.

The Scottsdale, AZ-based company, with $12.7 billion of market capitalization, belongs to the Zacks Diversified Operations industry. The company currently sports a Zacks Rank #1 (Strong Buy).

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Over the past year, Carlisle has outperformed its industry’s decline of 22% and the S&P 500’s fall of 8.9%.

Factors Favoring the Stock

Strength in the U.S. reroofing market and growing demand for energy-efficient building products have been driving the performance of Carlisle of late. Solid momentum in the company’s medical technologies business and recovery in the commercial aerospace business have also proven beneficial. Strength across its newer platforms of Sealants & Adhesives, Foam and Powder, coupled with its product innovation efforts and strong backlog level, bodes well. For 2022, it anticipates revenue growth of more than 30% on a year-over-year basis.

CSL intends to strengthen and expand its businesses through the acquisition of assets. Its buyout of Henry Company (September 2021) enhanced its product offerings for construction activities. The company anticipates the buyout to boost its 2022 earnings by $1.50 per share. Also, its MBTechnology acquisition (February 2022) has strengthened its energy-efficient solution offerings. Acquisitions contributed 14.7% to revenue growth in the first quarter of 2022.

It remains committed to rewarding shareholders through share repurchases and dividend payouts. In first-quarter 2022, CSL repurchased shares worth $125 million and paid out dividends of $28.7 million to its shareholders. Also, the quarterly dividend rate was hiked by 3% to 54 cents in August 2021. At the end of the first quarter, it had $4.5 million worth of shares left under its share repurchase authorization.

Carlisle seeks to leverage its Carlisle Operating System (COS) culture to drive efficiencies through business processes apart from returning cash to shareholders. In first-quarter 2022, its operating margin increased 950 basis points, driven by price realization, higher volumes and contribution from the COS.

In the past 60 days, the Zacks Consensus Estimate for Carlisle’s 2022 earnings has jumped from $14.36 to $17.64 on two upward estimate revisions against none downward. Also, over the same timeframe, the consensus estimate for 2023 earnings has increased from $16.15 to $19.50 on two upward estimate revisions versus none downward.

Other Stocks to Consider

Some other top-ranked companies are discussed below:

Griffon Corporation (GFF - Free Report) presently sports a Zacks Rank #1. GFF’s earnings surprise in the last four quarters was 97%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, Griffon’s earnings estimates have increased 80.5% for fiscal 2022 (ending September 2022). The stock has gained 33.5% in the past three months.

3M Company (MMM - Free Report) currently carries a Zacks Rank #2 (Buy). 3M’s earnings surprise in the last four quarters was 13.8%, on average.

In the past 60 days, MMM’s earnings estimates have increased 5.7% for 2022. The stock has lost 5.5% in the past three months.

Ferguson plc (FERG - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last reported quarter was 11.6%.

In the past 60 days, Ferguson’s earnings estimates have been stable for fiscal 2022 (ending July 2022). FERG’s shares have lost 25.7% in the past three months.

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