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Rexnord's (RXN) Solid Product Portfolio Raises Its Appeal
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We believe that Rexnord Corporation is a solid choice for investors, seeking exposure in the industrial machinery space. Newly launched products, DiRXN platform and synergistic benefits from acquired assets will be advantageous for the company.
The stock has been upgraded to a Zacks Rank #1 (Strong Buy) on Mar 20. It currently has a market capitalization of approximately $3.1 billion.
Rexnord delivered better-than-expected results in the last four quarters. Average earnings surprise was a positive 12.55%. Notably, the company’s shares rallied 12.2% in the last three months, outperforming 1.9% decline of the industry.
Why the Upgrade?
A strong brand image and efforts for further improvements in its portfolio add to Rexnord’s appeal. In February 2018, the company added a new product — the Tollok TLK 136 — to its locking devices product line. With a compact design, various options are available for these devices. Also, in the same month, it introduced 390 Series MatTop Chain for use in the pharmaceutical, metal container, beverage and food industries. This new product will help in lowering risks related to chain failure as well as help in reducing downtime and product damage.
The company’s digital enterprise strategy, DiRXN has been strengthening its Process & Motion Control segment since its launch in May 2017. The platform integrates innovative Industrial Internet of Things and e-commerce technologies to help customers to improve productivity.
Additionally, Rexnord’s business expansion initiatives through the acquisition of meaningful businesses have proved beneficial over time. The Centa Power Transmission buyout — completed in February 2018 — is anticipated to create new business opportunities in the couplings market and enhance its revenue generation capability by approximately $100 million. It will be integrated with the Process and Motion Control segment.
For fiscal 2018, Rexnord anticipates its core sales to grow in mid-single digit (earlier expectation was of low-to-mid single digit) and adjusted earnings before interest, tax, depreciation and amortization (EBITDA) to be $381-$387 million (previous expectation was $375-$385 million).
In the last 30 days, the company’s earnings estimates for both fiscal 2018 (ending March 2018) and fiscal 2019 (ending March 2019) was revised upward by one brokerage firm. The Zacks Consensus Estimate currently stands at $1.34 for fiscal 2018 and $1.72 for fiscal 2019, reflecting an increase of 0.8% and 1.2%, respectively, from their tallies 30 days ago.
Some other top-ranked stocks worth considering in the industry are ESCO Technologies Inc. (ESE - Free Report) , Emerson Electric Company (EMR - Free Report) and Regal Beloit Corporation (RBC - Free Report) . While ESCO Technologies sports a Zacks Rank #1, both Emerson Electric and Regal Beloit carries a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
In the last 60 days, the earnings estimates for these three stocks improved for both current year and next year. Also, average earnings surprise for the last four quarters was a positive 2.44% for ESCO Technologies, 2.79% for Emerson Electric and 2.88% for Regal Beloit.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
Image: Bigstock
Rexnord's (RXN) Solid Product Portfolio Raises Its Appeal
We believe that Rexnord Corporation is a solid choice for investors, seeking exposure in the industrial machinery space. Newly launched products, DiRXN platform and synergistic benefits from acquired assets will be advantageous for the company.
The stock has been upgraded to a Zacks Rank #1 (Strong Buy) on Mar 20. It currently has a market capitalization of approximately $3.1 billion.
Rexnord delivered better-than-expected results in the last four quarters. Average earnings surprise was a positive 12.55%. Notably, the company’s shares rallied 12.2% in the last three months, outperforming 1.9% decline of the industry.
Why the Upgrade?
A strong brand image and efforts for further improvements in its portfolio add to Rexnord’s appeal. In February 2018, the company added a new product — the Tollok TLK 136 — to its locking devices product line. With a compact design, various options are available for these devices. Also, in the same month, it introduced 390 Series MatTop Chain for use in the pharmaceutical, metal container, beverage and food industries. This new product will help in lowering risks related to chain failure as well as help in reducing downtime and product damage.
The company’s digital enterprise strategy, DiRXN has been strengthening its Process & Motion Control segment since its launch in May 2017. The platform integrates innovative Industrial Internet of Things and e-commerce technologies to help customers to improve productivity.
Additionally, Rexnord’s business expansion initiatives through the acquisition of meaningful businesses have proved beneficial over time. The Centa Power Transmission buyout — completed in February 2018 — is anticipated to create new business opportunities in the couplings market and enhance its revenue generation capability by approximately $100 million. It will be integrated with the Process and Motion Control segment.
For fiscal 2018, Rexnord anticipates its core sales to grow in mid-single digit (earlier expectation was of low-to-mid single digit) and adjusted earnings before interest, tax, depreciation and amortization (EBITDA) to be $381-$387 million (previous expectation was $375-$385 million).
In the last 30 days, the company’s earnings estimates for both fiscal 2018 (ending March 2018) and fiscal 2019 (ending March 2019) was revised upward by one brokerage firm. The Zacks Consensus Estimate currently stands at $1.34 for fiscal 2018 and $1.72 for fiscal 2019, reflecting an increase of 0.8% and 1.2%, respectively, from their tallies 30 days ago.
Rexnord Corporation Price and Consensus
Rexnord Corporation Price and Consensus | Rexnord Corporation Quote
Other Stocks to Consider
Some other top-ranked stocks worth considering in the industry are ESCO Technologies Inc. (ESE - Free Report) , Emerson Electric Company (EMR - Free Report) and Regal Beloit Corporation (RBC - Free Report) . While ESCO Technologies sports a Zacks Rank #1, both Emerson Electric and Regal Beloit carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the last 60 days, the earnings estimates for these three stocks improved for both current year and next year. Also, average earnings surprise for the last four quarters was a positive 2.44% for ESCO Technologies, 2.79% for Emerson Electric and 2.88% for Regal Beloit.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>