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Bull of the Day: Hubbell (HUBB)

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Hubbell (HUBB - Free Report) is a top international manufacturer of high-quality and reliable utility and electrical solutions that aid non-residential and residential construction, industrial applications, and utility applications.

The company’s earnings outlook has positively improved across all timeframes over the last several months, helping land the stock into the highly-coveted Zacks Rank #1 (Strong Buy).

Zacks Investment Research
Image Source: Zacks Investment Research

The company resides within the Zacks Manufacturing – Electrical Utilities industry, which is currently ranked in the top 1% of all industries thanks to positive earnings estimate revisions. As many are aware, roughly half of a stock’s movement can be attributed to its group, helping to clarify the importance of targeting industries seeing bright outlooks.

Aside from the improved earnings outlook and favorable industry standing, let’s take a closer look at a few other traits of Hubbell.  

Hubbell

HUBB shares could attract growth-focused investors, further reflected by the Style Score of “B” for Growth. Estimates for its current fiscal year suggest 40% EPS growth in its current fiscal year (FY23) on nearly 10% higher revenues.

Shares aren’t stretched regarding valuation on a relative basis, with the current 20.8X forward earnings multiple (F1) sitting just a few ticks above the 20.1X five-year median and nicely beneath 2022 highs of 24.9X.

Zacks Investment Research
Image Source: Zacks Investment Research

Hubbell recently delivered quarterly results that came in above expectations, exceeding the Zacks Consensus EPS Estimate by more than 12% and reporting revenue modestly above expectations. In fact, the company has surpassed EPS expectations by an average of an impressive 20% across its last four quarters.

The company has enjoyed steady sales growth, as illustrated in the chart below.

Zacks Investment Research
Image Source: Zacks Investment Research

In addition, shares could attract income-focused investors; HUBB shares currently yield 1.4% annually paired with a sustainable payout ratio sitting at 34% of earnings. The company has also consistently boosted its payout, carrying an 8% five-year annualized dividend growth rate.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

Investors can implement a stellar strategy to find expected winners by taking advantage of the Zacks Rank – one of the most powerful market tools that provides a massive edge.

The top 5% of all stocks receive the highly coveted Zacks Rank #1 (Strong Buy). These stocks should outperform the market more than any other rank.

Hubbell (HUBB - Free Report) would be an excellent stock for investors to consider, as displayed by its Zack Rank #1 (Strong Buy).


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