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TriMas (TRS) Poised to Gain on Strong Markets & Products

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On May 14, we issued an updated research report on TriMas Corporation (TRS - Free Report) . The company will gain from robust-end market demand, strong pipeline of both product and process innovation, and focus on leveraging the TriMas Business Model.

Strong Q1 Results & 2019 Guidance

TriMas Corporation delivered adjusted earnings of 46 cents per share in first-quarter 2019, improving 12% from the prior-year period. The company generated revenues of $221.3 million, advancing 2% year over year.

Backed by continued growth across all markets, the company anticipates organic sales growth of 3% to 5% in 2019. Operating profit is expected to be within the range of 16% to 17%. Adjusted earnings per share in 2019 is expected to lie between $1.82 and $1.92. The mid-point of the guidance range reflects an increase of approximately 7% over $1.75 reported in 2018. Continuous growth is expected across markets.

In 2019, the company will continue to focus on TriMas Business Model in order to better position its businesses to drive growth via innovation, and capitalize on market opportunities via manufacturing efficacy. General industrial activity levels have improved, particularly in the United States, and this bodes well for TriMas. The company is well poised to take advantage of the incremental volume opportunities and continues to capitalize on its internal sales growth programs. The company has refocused certain commercial efforts, including realigning and enhancing sales functions, and improvement of cost structure.

Positive Momentum in Segments

The company anticipates the Specialty Products segment to attain sales growth of 4-6% in 2019 while operating margin is projected in the range of 11% to 13%, driven by its continuous improvement initiatives. The segment’s performance will be aided by improving energy and industrial end-markets.

The packaging segment, the company’s most profitable business, should benefit from new products and realignment of the segment’s manufacturing footprint. The business continues to develop specialty dispensing and closure applications for higher-growth global markets (industrial, food and beverage and heath, beauty and home care). The company is developing global marketing and salesforce to better align with end-markets and customers. Further, the segment continues to witness robust quoting activity within its existing and new product lines and customers. TriMas’ 2019 organic sales growth guidance for the segment is 3-5% while operating profit margin is projected in the range of 22% to 23%.

In the Aerospace segment, the company is witnessing strong quoting activity, order intake and new business wins, particularly in the fastener product line. For 2019, the company anticipates achieving sales growth of 3.4% while operating margins are envisioned in the band of 16% to 17%.

Focus on TriMas Business Model & Products

TriMas will continue to focus on leveraging the TriMas Business Model, which was implemented in late 2016 to improve management and performance of its businesses. Its innovative solutions through product, process or service, and extensive resources will help enhance business performance. The company will benefit from connectivity, resource sharing, capitalization and planning.
The company also has a robust pipeline of both product and process innovation that will support long-term growth and position its businesses to capitalize on market opportunities. It will also aid in minimizing market disruptions.

Share Price Performance

Shares of TriMas gained 7.8% over the past year, against the industry’s decline of 24.1%.
Zacks Rank & Key Picks
TriMas carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks to Consider

Some other top-ranked stocks in the Industrial Products sector are DMC Global Inc. (BOOM - Free Report) , Lawson Products, Inc. (LAWS - Free Report) and Roper Technologies, Inc. (ROP - Free Report) , each sporting a Zacks Rank #1, at present.

DMC Global has an estimated earnings growth rate of 79.7% for the ongoing year. The company’s shares have soared 65%, in the past year.

Lawson Products has a stellar expected earnings growth rate of 24.5% for the current year. The stock has appreciated 59% in a year’s time.

Roper Technologies has a projected earnings growth rate of 7.9% for 2019. The company’s shares have gained 28%, over the past year.

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