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Shares of AGCO Corporation (AGCO - Free Report) have been performing well, of late. If you haven’t taken advantage of its share price appreciation yet, this is the right time to add the stock to your portfolio as it looks promising and is poised to carry the momentum ahead. The stock has estimated long-term earnings growth rate of 13.5%.
Favorable Zacks Rank & Score
AGCO currently sports a Zacks Rank #1 (Strong Buy) and a VGM Score of A. Here V stands for Value, G for Growth and M for Momentum. AGCO’s score is a weighted combination of these three scores. Such a score allows investors to eliminate the negative aspects of stocks and select winners. Our research shows that stocks with a VGM Score of ‘A’ or ‘B’ when combined with a Zacks Rank #1 or #2 offer the best upside potential.
Hiked Guidance
Owing to the elevated sales volumes, positive pricing and acquisition impacts, AGCO raised its net sales guidance to around $8 billion for 2017. The raised guidance also reflects the benefits of the company’s efforts to reduce expenses, invest in new technologies, productivity enhancements and launch of products.
AGCO also lifted its earnings per share target for 2017 to around $3.00. The company guided its third-quarter 2017 earnings per share in the band of 65-70 cents. For the long term, it expects robust grain demand, stemmed by population growth and increased protein consumption, which will result in favorable income levels for farmers.
Estimates Northbound
Estimates for AGCO have moved up in the past 60 days, reflecting optimistic outlook of analysts. The earnings estimate for third-quarter 2017, 2017 and 2018 have all gone up during the said time frame.
For third-quarter 2017, the Zacks Consensus Estimate for earnings has moved up 4.4% to 71 cents in the past 60 days. The estimate for 2017 has climbed 9.4% to $3.03. The Zacks Consensus Estimate for earnings for 2018 has moved north 10% to $3.77 during the same time frame.
Positive Earnings Surprise History
AGCO outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive earnings surprise of 39.7%.
Ahead of the Industry
AGCO has outperformed the industry in the past year. While the company’s shares have gained 43.8%, the industry registered growth of 36.3%.
Growth Drivers
AGCO continues to make strategic investments in order to refresh and expand its product lines, upgrade system capabilities and improve factory productivity. The company’s gross and operating margins are likely to improve from the 2016 levels on the back of elevated sales, along with the benefits resulting from its cost-reduction initiatives.
Despite expected escalation in expenses, benefits of increased sales and production, fixed cost-reduction efforts, as well as consistent progress on productivity and purchasing initiatives will fuel AGCO’s growth.
Terex has expected long-term growth rate of 19.7%.
Caterpillar has expected long-term growth rate of 9.5%.
Komatsu has expected long-term growth rate of 12.7%.
Zacks' 10-Minute Stock-Picking Secret
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month. Learn the secret >>
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6 Reasons to Add AGCO Stock to Your Portfolio Now
Shares of AGCO Corporation (AGCO - Free Report) have been performing well, of late. If you haven’t taken advantage of its share price appreciation yet, this is the right time to add the stock to your portfolio as it looks promising and is poised to carry the momentum ahead. The stock has estimated long-term earnings growth rate of 13.5%.
Favorable Zacks Rank & Score
AGCO currently sports a Zacks Rank #1 (Strong Buy) and a VGM Score of A. Here V stands for Value, G for Growth and M for Momentum. AGCO’s score is a weighted combination of these three scores. Such a score allows investors to eliminate the negative aspects of stocks and select winners. Our research shows that stocks with a VGM Score of ‘A’ or ‘B’ when combined with a Zacks Rank #1 or #2 offer the best upside potential.
Hiked Guidance
Owing to the elevated sales volumes, positive pricing and acquisition impacts, AGCO raised its net sales guidance to around $8 billion for 2017. The raised guidance also reflects the benefits of the company’s efforts to reduce expenses, invest in new technologies, productivity enhancements and launch of products.
AGCO also lifted its earnings per share target for 2017 to around $3.00. The company guided its third-quarter 2017 earnings per share in the band of 65-70 cents. For the long term, it expects robust grain demand, stemmed by population growth and increased protein consumption, which will result in favorable income levels for farmers.
Estimates Northbound
Estimates for AGCO have moved up in the past 60 days, reflecting optimistic outlook of analysts. The earnings estimate for third-quarter 2017, 2017 and 2018 have all gone up during the said time frame.
For third-quarter 2017, the Zacks Consensus Estimate for earnings has moved up 4.4% to 71 cents in the past 60 days. The estimate for 2017 has climbed 9.4% to $3.03. The Zacks Consensus Estimate for earnings for 2018 has moved north 10% to $3.77 during the same time frame.
Positive Earnings Surprise History
AGCO outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average positive earnings surprise of 39.7%.
Ahead of the Industry
AGCO has outperformed the industry in the past year. While the company’s shares have gained 43.8%, the industry registered growth of 36.3%.
Growth Drivers
AGCO continues to make strategic investments in order to refresh and expand its product lines, upgrade system capabilities and improve factory productivity. The company’s gross and operating margins are likely to improve from the 2016 levels on the back of elevated sales, along with the benefits resulting from its cost-reduction initiatives.
Despite expected escalation in expenses, benefits of increased sales and production, fixed cost-reduction efforts, as well as consistent progress on productivity and purchasing initiatives will fuel AGCO’s growth.
Other Stocks to Consider
Other top-ranked stocks in the industrial product space include Terex Corporation (TEX - Free Report) , Caterpillar Inc. (CAT - Free Report) and Komatsu Ltd. (KMTUY - Free Report) . All these three stocks sport the same rank as AGCO. You can see the complete list of today’s Zacks #1 Rank stocks here.
Terex has expected long-term growth rate of 19.7%.
Caterpillar has expected long-term growth rate of 9.5%.
Komatsu has expected long-term growth rate of 12.7%.
Zacks' 10-Minute Stock-Picking Secret
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
But here's something even more remarkable: You can master this proven system without going to a single class or seminar. And then you can apply it to your portfolio in as little as 10 minutes a month.
Learn the secret >>