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Manitowoc (MTW) Up 63% in 6 Months: Will the Trend Continue?

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Shares of The Manitowoc Company (MTW - Free Report) have gained 63.1% over the past six months, faring better than the industry which witnessed a decline of 9%. The S&P500 has gained 4.9% in the same timeframe.

MTW’s performance has been aided by the ongoing improvement in order levels, robust backlog as well as solid earnings beat in the last two quarters and an upbeat outlook for 2023.

MTW has a market capitalization of around $549 million and currently sports a Zacks Rank #1 (Strong Buy).

Zacks Investment Research
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Driving Factors

Manitowoc’s reported revenues of $508 million in the first quarter of 2023. The top line beat the Zacks Consensus Estimate of $466 million and improved 10.7% year over year. Adjusted earnings per share (EPS) for the quarter was 46 cents which beat the Zacks Consensus Estimate of 5 cents by a solid margin of 820%. The bottom line also marked a substantial improvement from the earnings of 3 cents per share reported in the year-ago quarter.

This follows a solid earnings beat of 221.7% delivered by MTW in the fourth quarter of 2022. Overall, the company has an impressive trailing four-quarter earnings surprise of 256%, on average.

Orders in the first quarter of 2023 increased 9% year over year to $525 million. The backlog at the end of the quarter was $1,076 million, up from $1,033 million reported in the last-year quarter. Backed by this momentum, Manitowoc expects revenues of $2-$2.1 billion for 2023. The company reported revenues of $2.03 billion in 2022. Adjusted EPS is expected between 35 cents and $1.15, compared with the adjusted EPS of $1.06 in 2022.

In North America, demand from residential and non-residential construction is driving demand for Manitowoc’s equipment. Due to the U.S. Infrastructure Investment and Jobs Act, the rising investment in roads, bridges, airports and waterways represents a massive opportunity. The company expects demand in the Middle East to be robust in the upcoming quarters. Qatar and Kuwait are also showing signs of growth. This bodes well for Manitowoc.

Moreover, the company’s focus on innovation will continue to aid it in leading the industry by providing differentiated products that add value to customers. Manitowoc has been taking actions to align production with the changing levels of demand. Operational focus, healthy balance sheet and market-leading products position it well to capitalize as end markets recover.

Manitowoc has been able to negate the persisting impacts of supply-chain challenges, inflationary costs and skilled labor shortages with its pricing actions and efforts to cut down costs.

Earnings estimates for Manitowoc have also been going up over the past 30 days. The Zacks Consensus Estimate for 2023 bottom line has increased around 29% and the same for 2024 has moved up 11%. The favorable estimate revisions instill investor confidence in the stock.

Other Stocks to Consider

Some other top-ranked stocks from the Industrial Products sector are Worthington Industries, Inc. (WOR - Free Report) , AptarGroup, Inc. (ATR - Free Report) and Alamo Group (ALG - Free Report) , all of which sport a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Worthington Industries has an average trailing four-quarter earnings surprise of 27.5%. The Zacks Consensus Estimate for WOR’s fiscal 2023 earnings is pegged at $4.93 per share. The consensus estimate for 2023 earnings has moved north by 17.7% in the past 60 days. Its shares gained 0.4% in the last six months.

AptarGroup has an average trailing four-quarter earnings surprise of 6.4%. The Zacks Consensus Estimate for ATR’s 2023 earnings is pegged at $4.04 per share. The consensus estimate for 2023 earnings has moved up by 5% in the past 60 days. ATR’s shares gained 12% over the past six months.

The Zacks Consensus Estimate for Alamo Group’s 2023 EPS is pegged at $11.03. The consensus estimate for 2023 earnings rose 13% in the last 30 days. ALG has a trailing four-quarter average earnings surprise of 17.7%. Its shares have gone up 19% in the last six months.

 

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