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Why Should You Add Carpenter Technology (CRS) to Your Portfolio?
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Carpenter Technology Corporation (CRS - Free Report) has been benefiting from strong demand across its end markets.
The company’s cost-cutting initiatives and efforts to preserve liquidity will drive growth. Recent acquisitions and investments in additive manufacturing will also boost the results.
Let's see what makes this stock a compelling investment option at the moment.
Solid FY23 Results: Carpenter Technology reported adjusted earnings of $1.14 per share in fiscal 2023, beating the Zacks Consensus Estimate of adjusted earnings of $1.04. The company had reported an adjusted loss per share of $1.06 in fiscal 2022.
Net sales increased 38.9% year over year to $2,550 million. The figure topped the Zacks Consensus Estimate of $2,516 million.
Positive Earnings Surprise History: CRS has an average trailing four-quarter earnings surprise of 10%.
Optimistic Growth Projections: The Zacks Consensus Estimate for the company’s first-quarter fiscal 2024 earnings has moved 32% upward over the past 60 days and is pegged at 75 cents per share. It suggests notable growth from a loss of 14 cents reported in the year-ago quarter.
The favorable estimate revisions instill investor confidence in the stock.
Price Performance: Shares of this company have gained 59.4% in the past year compared with the industry’s growth of 39.9%.
Image Source: Zacks Investment Research
Solid Backlog Growth: In the third quarter of fiscal 2023, Carpenter Technology’s backlog grew 4% on a sequential basis and 38% year over year, backed by strong booking growth. This is the 10th quarter in a row that the backlog has increased.
The company expects continued growth across its end-use markets, especially in Aerospace, Defense and Medical applications, which is expected to boost fiscal 2024 results. Backed by the record backlog levels, the company's near and long-term outlooks for each end-use market remain positive.
Strong Demand: The company has been witnessing broad-based demand recovery in the aerospace and defense and medical end-use market, which will continue in fiscal 2024.
Aerospace is gaining from the pickup in global travel. Demand continues to accelerate across all the aerospace submarkets as the supply chain ramps up to meet steadily increasing travel demand.
Additional capacity at its Athens facility will position the company to capture incremental growth in aerospace. In defense, the company is gaining from increased investments with customers on the development of the next-gen programs and platforms.
Impressive Strategic Actions: Carpenter Technology has been demonstrating its recovery growth trajectory through fiscal 2023, with increased productivity across the company’s facilities. It expects to make substantial progress in fiscal 2024. To further drive shareholder returns, the company seeks to incorporate strategic initiatives to maximize market demand, accelerate growth, optimize operations and generate cash.
The company expects operating income to double from the fiscal 2019 levels by fiscal 2027. The upside will primarily be driven by higher prices, improved product mix and increased volumes. The increase in operating income will provide significant cash flow over the next several years, adding value to the company’s stockholders.
Zacks Rank & Other Stocks to Consider
Carpenter Technology currently flaunts a Zacks Rank #1 (Strong Buy).
Hawkins has an average trailing four-quarter earnings surprise of 25.5%. The Zacks Consensus Estimate for HWKN’s fiscal 2024 earnings is pegged at $3.40 per share. The consensus estimate for 2024 earnings has moved 38% north in the past 60 days. Its shares gained 30.6% in the last year.
The Zacks Consensus Estimate for PPG Industries’ fiscal 2023 earnings per share is pegged at $7.47, indicating growth of 23.5% from the prior-year actual. Earnings estimates have moved 3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 7.3%. PPG’s shares have gained 9.7% in the past year.
L.B. Foster has an average trailing four-quarter earnings surprise of 134.5%. The Zacks Consensus Estimate for FSTR’s 2023 earnings is pegged at 53 cents per share. Earnings estimates have been unchanged in the past 60 days. FSTR’s shares gained 30.1% in the last year.
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Why Should You Add Carpenter Technology (CRS) to Your Portfolio?
Carpenter Technology Corporation (CRS - Free Report) has been benefiting from strong demand across its end markets.
The company’s cost-cutting initiatives and efforts to preserve liquidity will drive growth. Recent acquisitions and investments in additive manufacturing will also boost the results.
Let's see what makes this stock a compelling investment option at the moment.
Solid FY23 Results: Carpenter Technology reported adjusted earnings of $1.14 per share in fiscal 2023, beating the Zacks Consensus Estimate of adjusted earnings of $1.04. The company had reported an adjusted loss per share of $1.06 in fiscal 2022.
Net sales increased 38.9% year over year to $2,550 million. The figure topped the Zacks Consensus Estimate of $2,516 million.
Positive Earnings Surprise History: CRS has an average trailing four-quarter earnings surprise of 10%.
Optimistic Growth Projections: The Zacks Consensus Estimate for the company’s first-quarter fiscal 2024 earnings has moved 32% upward over the past 60 days and is pegged at 75 cents per share. It suggests notable growth from a loss of 14 cents reported in the year-ago quarter.
The favorable estimate revisions instill investor confidence in the stock.
Price Performance: Shares of this company have gained 59.4% in the past year compared with the industry’s growth of 39.9%.
Image Source: Zacks Investment Research
Solid Backlog Growth: In the third quarter of fiscal 2023, Carpenter Technology’s backlog grew 4% on a sequential basis and 38% year over year, backed by strong booking growth. This is the 10th quarter in a row that the backlog has increased.
The company expects continued growth across its end-use markets, especially in Aerospace, Defense and Medical applications, which is expected to boost fiscal 2024 results. Backed by the record backlog levels, the company's near and long-term outlooks for each end-use market remain positive.
Strong Demand: The company has been witnessing broad-based demand recovery in the aerospace and defense and medical end-use market, which will continue in fiscal 2024.
Aerospace is gaining from the pickup in global travel. Demand continues to accelerate across all the aerospace submarkets as the supply chain ramps up to meet steadily increasing travel demand.
Additional capacity at its Athens facility will position the company to capture incremental growth in aerospace. In defense, the company is gaining from increased investments with customers on the development of the next-gen programs and platforms.
Impressive Strategic Actions: Carpenter Technology has been demonstrating its recovery growth trajectory through fiscal 2023, with increased productivity across the company’s facilities. It expects to make substantial progress in fiscal 2024. To further drive shareholder returns, the company seeks to incorporate strategic initiatives to maximize market demand, accelerate growth, optimize operations and generate cash.
The company expects operating income to double from the fiscal 2019 levels by fiscal 2027. The upside will primarily be driven by higher prices, improved product mix and increased volumes. The increase in operating income will provide significant cash flow over the next several years, adding value to the company’s stockholders.
Zacks Rank & Other Stocks to Consider
Carpenter Technology currently flaunts a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks from the basic materials space are Hawkins, Inc. (HWKN - Free Report) , PPG Industries, Inc. (PPG - Free Report) and L.B. Foster Company (FSTR - Free Report) . HWKN and PPG sport a Zacks Rank #1 at present, and FSTR has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Hawkins has an average trailing four-quarter earnings surprise of 25.5%. The Zacks Consensus Estimate for HWKN’s fiscal 2024 earnings is pegged at $3.40 per share. The consensus estimate for 2024 earnings has moved 38% north in the past 60 days. Its shares gained 30.6% in the last year.
The Zacks Consensus Estimate for PPG Industries’ fiscal 2023 earnings per share is pegged at $7.47, indicating growth of 23.5% from the prior-year actual. Earnings estimates have moved 3% north in the past 60 days. It has an average trailing four-quarter earnings surprise of 7.3%. PPG’s shares have gained 9.7% in the past year.
L.B. Foster has an average trailing four-quarter earnings surprise of 134.5%. The Zacks Consensus Estimate for FSTR’s 2023 earnings is pegged at 53 cents per share. Earnings estimates have been unchanged in the past 60 days. FSTR’s shares gained 30.1% in the last year.