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RBC Bearings (ROLL) Poised to Grow Amid Macro Headwinds
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On Mar 17, Zacks Investment Research upgraded RBC Bearings Inc. to a Zacks Rank #3 (Hold) from a Zacks Rank #4 (Sell). Going by the Zacks model, companies with a Zacks Rank #3 have chances of delivering in-line performances with the broader market over the upcoming quarters.
Why a Neutral Stance?
Over the last six months, RBC Bearings’ shares yielded a return of 24.14%, outperforming 18.91% gain recorded by the Zacks categorized Machinery-General Industrial industry.
President Donald Trump’s intention to boost government spending and slash taxes has given rise to positive market sentiments. Additionally, stable job growth in the U.S. has been reinforcing the broader market. All these aspects are likely to increase infrastructure and industrial spending in the U.S., as well as bolster sales of industrial products companies such as RBC Bearings.
Also, higher demand from the commercial aerospace original equipment manufacturers is anticipated to boost RBC Bearings’ aerospace business in the upcoming quarters. Furthermore, increased demand in the mining, semiconductor and marine end markets would drive overall sales of the company’s industrial business.
However, weak prices of energy resources like oil are currently affecting the revenues generated by manufacturing and industrial companies like RBC Bearings. Soft oil prices have been hurting the oil companies’ sales. This, in turn, significantly reduces the extent of Greenfield investments made within the sector. As a result, lower investments made by oil companies are affecting the sales generated by producers of heavy equipment, machinery parts and steel in the U.S., including RBC Bearings.
At the same time, international businesses expose the company to foreign currency translations and other geopolitical risks. For instance, the appreciating U.S. currency enhances the competitive power of smaller companies operating in low-cost nations, thereby increasing revenue and margin loss risks for RBC Bearings.
Moreover, the company's financial performance is largely affected by seasonal fluctuations.
Over the last 30 days, the Zacks Consensus Estimate for the stock remained unchanged for both fiscal 2017 and 2018.
Stocks to Consider
Some better-ranked stocks within the industry are listed below:
Applied Industrial Technologies, Inc. (AIT - Free Report) carries a Zacks Rank #2 (Buy) and has a positive average earnings surprise of 6.18% for the trailing four quarters.
Avery Dennison Corporation (AVY - Free Report) also holds a Zacks Rank #2 and has an average earnings surprise of 6.17% for the past four quarters.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>
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RBC Bearings (ROLL) Poised to Grow Amid Macro Headwinds
On Mar 17, Zacks Investment Research upgraded RBC Bearings Inc. to a Zacks Rank #3 (Hold) from a Zacks Rank #4 (Sell). Going by the Zacks model, companies with a Zacks Rank #3 have chances of delivering in-line performances with the broader market over the upcoming quarters.
Why a Neutral Stance?
Over the last six months, RBC Bearings’ shares yielded a return of 24.14%, outperforming 18.91% gain recorded by the Zacks categorized Machinery-General Industrial industry.
President Donald Trump’s intention to boost government spending and slash taxes has given rise to positive market sentiments. Additionally, stable job growth in the U.S. has been reinforcing the broader market. All these aspects are likely to increase infrastructure and industrial spending in the U.S., as well as bolster sales of industrial products companies such as RBC Bearings.
Also, higher demand from the commercial aerospace original equipment manufacturers is anticipated to boost RBC Bearings’ aerospace business in the upcoming quarters. Furthermore, increased demand in the mining, semiconductor and marine end markets would drive overall sales of the company’s industrial business.
However, weak prices of energy resources like oil are currently affecting the revenues generated by manufacturing and industrial companies like RBC Bearings. Soft oil prices have been hurting the oil companies’ sales. This, in turn, significantly reduces the extent of Greenfield investments made within the sector. As a result, lower investments made by oil companies are affecting the sales generated by producers of heavy equipment, machinery parts and steel in the U.S., including RBC Bearings.
At the same time, international businesses expose the company to foreign currency translations and other geopolitical risks. For instance, the appreciating U.S. currency enhances the competitive power of smaller companies operating in low-cost nations, thereby increasing revenue and margin loss risks for RBC Bearings.
Moreover, the company's financial performance is largely affected by seasonal fluctuations.
Over the last 30 days, the Zacks Consensus Estimate for the stock remained unchanged for both fiscal 2017 and 2018.
Stocks to Consider
Some better-ranked stocks within the industry are listed below:
ACCO Brands Corporation (ACCO - Free Report) has a positive average earnings surprise of 24.74% for the last four quarters and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Applied Industrial Technologies, Inc. (AIT - Free Report) carries a Zacks Rank #2 (Buy) and has a positive average earnings surprise of 6.18% for the trailing four quarters.
Avery Dennison Corporation (AVY - Free Report) also holds a Zacks Rank #2 and has an average earnings surprise of 6.17% for the past four quarters.
5 Trades Could Profit ""Big-League"" from Trump Policies
If the stocks above spark your interest, wait until you look into companies primed to make substantial gains from Washington's changing course.
Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals, tariffs, lower taxes, higher interest rates, and spending surges in defense and infrastructure. See these buy recommendations now >>