We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Here's Why it is Worth Investing in Tennant (TNC) Stock Now
Read MoreHide Full Article
Tennant Company (TNC - Free Report) can currently be considered a smart choice for investors seeking exposure in the manufacturing industry. It has solid fundamentals and boasts solid growth prospects, evident from positive revision in its earnings estimates.
We believe that a spur in construction and remodeling activities, technological advancement in manufacturing processes, the growing popularity of e-retailing, and infrastructure development are a few factors that favor companies operating in the industry.
Below we discussed why it is worth investing in Tennant.
Healthy Performance and Solid Growth Prospects: The company performed well in the last four quarters, with a positive earnings surprise of 26.60%, on average. Notably, its earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 60 cents by 6.67%.
As noted, the company is focused on reducing complexity and building scalable processes. Also, innovation and expansion, where competitive advantages exist, might aid. For 2020, Tennant anticipates net sales of $1.15-$1.16 billion, suggesting growth from $1.14 billion reported in 2019. Organic sales will likely increase 1.5-2.5%.
Adjusted earnings will probably be $4.00-$4.15 per share, indicating growth from $2.90 reported in 2019.
Despite the impressive results and promising projections, the company’s price performance has not been very appealing. Year to date, its share price has decreased 31.2% as compared with the industry’s decline of 33.6%.
Rewards to Shareholders: Tennant is committed toward rewarding shareholders handsomely through dividend payments. In 2019, it paid out dividends of $16 million or 88 cents per share. The payment represents an increase from $15.3 million or 85 cents per share paid out in 2018.
It is worth mentioning here that the company refrained from repurchasing any shares in 2019. Exiting the year, it had the authorization to buy back 1.4 million of its common shares.
Investments: The company is focused on capacity expansion and expanding growth opportunities through acquisitions. In 2019, it invested $38.4 million for purchasing property, plant and equipment, reflecting an increase from $18.8 million spent in 2018. For 2020, the company intends on spending $35 million in capital expenditure.
Also, it completed the buyout of Hefei Gaomei Cleaning Machines Co., Ltd. and Anhui Rongen Environmental Protection Technology Co., Ltd. in January 2019. The latter specializes in making cleaning solutions and equipment for industrial and commercial purposes. Since acquired, the acquired assets have helped in strengthening Tennant’s manufacturing capabilities in China.
Earnings Estimate Trend: In the past 30 days, two upward revisions have been recorded for the company’s earnings estimates for 2020, while one positive revision has been witnessed for 2021. There was no downward revision for the years.
Currently, the Zacks Consensus Estimate for Tennant’s earnings is pegged at $4.08 for 2020 and $4.50 for 2021, reflecting growth of 37.4% and 27.1% from the 30-day-ago figures. On a year-over-year basis, earnings estimates for 2020 and 2021 indicate growth of 40.7% and 10.3%, respectively.
In the past 60 days, earnings estimates for Graco and Dover have improved for the current year, while the same has been unchanged for Broadwind. Further, positive earnings surprise for the last four quarters, on average, was 0.40% for Graco, 5.36% for Dover and 10.42% for Broadwind.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Image: Bigstock
Here's Why it is Worth Investing in Tennant (TNC) Stock Now
Tennant Company (TNC - Free Report) can currently be considered a smart choice for investors seeking exposure in the manufacturing industry. It has solid fundamentals and boasts solid growth prospects, evident from positive revision in its earnings estimates.
The Minneapolis, MN-based company currently sports a Zacks Rank #1 (Strong Buy) and has a VGM Score of A. It belongs to the Zacks Manufacturing – General Industrial industry, which belongs to the broader Zacks Industrial Products sector.
We believe that a spur in construction and remodeling activities, technological advancement in manufacturing processes, the growing popularity of e-retailing, and infrastructure development are a few factors that favor companies operating in the industry.
Below we discussed why it is worth investing in Tennant.
Healthy Performance and Solid Growth Prospects: The company performed well in the last four quarters, with a positive earnings surprise of 26.60%, on average. Notably, its earnings of 64 cents per share surpassed the Zacks Consensus Estimate of 60 cents by 6.67%.
As noted, the company is focused on reducing complexity and building scalable processes. Also, innovation and expansion, where competitive advantages exist, might aid. For 2020, Tennant anticipates net sales of $1.15-$1.16 billion, suggesting growth from $1.14 billion reported in 2019. Organic sales will likely increase 1.5-2.5%.
Adjusted earnings will probably be $4.00-$4.15 per share, indicating growth from $2.90 reported in 2019.
Despite the impressive results and promising projections, the company’s price performance has not been very appealing. Year to date, its share price has decreased 31.2% as compared with the industry’s decline of 33.6%.
Rewards to Shareholders: Tennant is committed toward rewarding shareholders handsomely through dividend payments. In 2019, it paid out dividends of $16 million or 88 cents per share. The payment represents an increase from $15.3 million or 85 cents per share paid out in 2018.
It is worth mentioning here that the company refrained from repurchasing any shares in 2019. Exiting the year, it had the authorization to buy back 1.4 million of its common shares.
Investments: The company is focused on capacity expansion and expanding growth opportunities through acquisitions. In 2019, it invested $38.4 million for purchasing property, plant and equipment, reflecting an increase from $18.8 million spent in 2018. For 2020, the company intends on spending $35 million in capital expenditure.
Also, it completed the buyout of Hefei Gaomei Cleaning Machines Co., Ltd. and Anhui Rongen Environmental Protection Technology Co., Ltd. in January 2019. The latter specializes in making cleaning solutions and equipment for industrial and commercial purposes. Since acquired, the acquired assets have helped in strengthening Tennant’s manufacturing capabilities in China.
Earnings Estimate Trend: In the past 30 days, two upward revisions have been recorded for the company’s earnings estimates for 2020, while one positive revision has been witnessed for 2021. There was no downward revision for the years.
Currently, the Zacks Consensus Estimate for Tennant’s earnings is pegged at $4.08 for 2020 and $4.50 for 2021, reflecting growth of 37.4% and 27.1% from the 30-day-ago figures. On a year-over-year basis, earnings estimates for 2020 and 2021 indicate growth of 40.7% and 10.3%, respectively.
Tennant Company Price and Consensus
Tennant Company price-consensus-chart | Tennant Company Quote
Other Key Picks
Some other top-ranked stocks in the industry are Graco Inc. (GGG - Free Report) , Dover Corporation (DOV - Free Report) and Broadwind Energy, Inc. (BWEN - Free Report) . While Graco currently sports a Zacks Rank #1, both Dover and Broadwind carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, earnings estimates for Graco and Dover have improved for the current year, while the same has been unchanged for Broadwind. Further, positive earnings surprise for the last four quarters, on average, was 0.40% for Graco, 5.36% for Dover and 10.42% for Broadwind.
Zacks Top 10 Stocks for 2020
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2020?
Last year's 2019 Zacks Top 10 Stocks portfolio returned gains as high as +102.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buys.
Access Zacks Top 10 Stocks for 2020 today >>