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Shares of The Timken Company (TKR - Free Report) scaled a new 52-week high of $87.94 on Mar 2, before closing the session a tad lower at $87.66.
TKR has a market capitalization of $6.35 billion and a Zacks Rank #3 (Hold), currently.
In the past year, Timken’s shares have gained 32.7% compared with the industry’s 3.5% growth.
Image Source: Zacks Investment Research
Driving Factors
Underlying customer demand and end-market momentum remain strong across most of Timken’s sectors. TKR continues to witness business wins in new markets and regions. Apart from strong demand, earnings growth continues to be supported by benefits from price realization and growth initiatives. The company has managed to offset the impacts of inflationary cost pressure through pricing actions and operational excellence initiatives. Timken has been adding to its inventory to meet the high customer demand and to accommodate supply-chain issues. This has helped in mitigating internal and external supply-chain constraints and inefficiencies.
Timken reported record adjusted EPS of $6.02 in 2022, which increased 28% year over year. The year-over-year improvement is primarily due to favorable pricing actions and higher volume, which are partially offset by higher operating costs and interest expenses, a higher tax rate, and the net unfavorable impact of impairment charges and other special items.
Total revenues in 2022 were $4.5 billion, 8.8% higher on a year-over-year basis. The upside was due to organic growth across most end-market sectors, and the impacts of higher pricing and acquisitions, partially offset by unfavorable foreign currency translation.
Backed by the healthy demand in its end markets, Timken expects 2023 total revenues to be up 6% at the mid-point from the 2022 reported levels. The company anticipates adjusted EPS between $6.50 and $7.10 per share for the year. TKR expects to benefit from favorable price-cost, organic outgrowth initiatives, improving operational execution and the impacts of recent acquisitions.
Earnings estimates for Timken have also moved up over the past month. The Zacks Consensus Estimate for 2023 bottom line has increased 3% and the same for 2024 has moved up 4%. The favorable estimate revisions instill investor’s confidence in the stock.
OI Glass has an average trailing four-quarter earnings surprise of 16.4%. The Zacks Consensus Estimate for OI’s 2023 earnings is pegged at $2.57 per share. This indicates an 11.7% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved 16% north in the past 60 days. OI’s shares gained 71.3% in the last year.
Tenaris has an average trailing four-quarter earnings surprise of 11.5%. The Zacks Consensus Estimate for TS’ 2023 earnings is pegged at $6.04 per share. This indicates a 39.5% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved north by 17% in the past 60 days. Its shares gained 29.7% in the last year.
The Zacks Consensus Estimate for Deere & Company’s fiscal 2023 earnings per share is pegged at $29.82, suggesting an increase of 28.1% from that reported in the last year. The consensus estimate for fiscal 2023 earnings moved 6% upward in the last 60 days. DE has a trailing four-quarter average earnings surprise of 4.7%. Its shares gained 15.9% in the last year.
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Timken (TKR) Stock Scales 52-Week High: What's Driving It?
Shares of The Timken Company (TKR - Free Report) scaled a new 52-week high of $87.94 on Mar 2, before closing the session a tad lower at $87.66.
TKR has a market capitalization of $6.35 billion and a Zacks Rank #3 (Hold), currently.
In the past year, Timken’s shares have gained 32.7% compared with the industry’s 3.5% growth.
Image Source: Zacks Investment Research
Driving Factors
Underlying customer demand and end-market momentum remain strong across most of Timken’s sectors. TKR continues to witness business wins in new markets and regions. Apart from strong demand, earnings growth continues to be supported by benefits from price realization and growth initiatives. The company has managed to offset the impacts of inflationary cost pressure through pricing actions and operational excellence initiatives. Timken has been adding to its inventory to meet the high customer demand and to accommodate supply-chain issues. This has helped in mitigating internal and external supply-chain constraints and inefficiencies.
Timken reported record adjusted EPS of $6.02 in 2022, which increased 28% year over year. The year-over-year improvement is primarily due to favorable pricing actions and higher volume, which are partially offset by higher operating costs and interest expenses, a higher tax rate, and the net unfavorable impact of impairment charges and other special items.
Total revenues in 2022 were $4.5 billion, 8.8% higher on a year-over-year basis. The upside was due to organic growth across most end-market sectors, and the impacts of higher pricing and acquisitions, partially offset by unfavorable foreign currency translation.
Backed by the healthy demand in its end markets, Timken expects 2023 total revenues to be up 6% at the mid-point from the 2022 reported levels. The company anticipates adjusted EPS between $6.50 and $7.10 per share for the year. TKR expects to benefit from favorable price-cost, organic outgrowth initiatives, improving operational execution and the impacts of recent acquisitions.
Earnings estimates for Timken have also moved up over the past month. The Zacks Consensus Estimate for 2023 bottom line has increased 3% and the same for 2024 has moved up 4%. The favorable estimate revisions instill investor’s confidence in the stock.
Key Picks
Some better-ranked stocks from the Industrial Products sector are OI Glass (OI - Free Report) , Tenaris (TS - Free Report) and Deere & Company (DE - Free Report) . OI and TS sport a Zacks Rank #1 (Strong Buy) at present, and DE has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
OI Glass has an average trailing four-quarter earnings surprise of 16.4%. The Zacks Consensus Estimate for OI’s 2023 earnings is pegged at $2.57 per share. This indicates an 11.7% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved 16% north in the past 60 days. OI’s shares gained 71.3% in the last year.
Tenaris has an average trailing four-quarter earnings surprise of 11.5%. The Zacks Consensus Estimate for TS’ 2023 earnings is pegged at $6.04 per share. This indicates a 39.5% increase from the prior-year reported figure. The consensus estimate for 2023 earnings has moved north by 17% in the past 60 days. Its shares gained 29.7% in the last year.
The Zacks Consensus Estimate for Deere & Company’s fiscal 2023 earnings per share is pegged at $29.82, suggesting an increase of 28.1% from that reported in the last year. The consensus estimate for fiscal 2023 earnings moved 6% upward in the last 60 days. DE has a trailing four-quarter average earnings surprise of 4.7%. Its shares gained 15.9% in the last year.