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Here's Why You Should Retain ABM Industries' (ABM) Stock
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ABM Industries Incorporated (ABM - Free Report) currently benefits from strategic acquisitions and investor-friendly steps.
ABM’s earnings are anticipated to grow 2% and 8.2% in 2022 and 2023, respectively. Shares of ABM Industries have rallied 18.7% in the year-to-date period compared with the 7.1% rise of the industry it belongs to.
Image Source: Zacks Investment Research
Factors That Augur Well
ABM Industries' strategy entails growth through strategic acquisitions and organic investment. The buyout of Able Services strengthens ABM’s engineering and technical services, expands its sustainability and energy efficiency offerings and bolsters its core businesses and key geographies.
ABM’s multi-year comprehensive strategic plan ELEVATE, focuses on providing clients with offerings that enhance transparency and efficiencies, develop its own talent management system capabilities, expand data usage and modernize the digital ecosystem.
We are also impressed with ABM Industries’ endeavors in rewarding its shareholders through dividend payments and share repurchases. In fiscal 2021, ABM paid out $51 million as dividends but did not repurchase any shares. In fiscal 2020, it returned $49.3 million via dividend payment and $5.1 million through share buyback. In fiscal 2019, ABM returned $47.7 million of dividends to its shareholders but did not repurchase any shares. Such moves underpin its commitment to creating shareholder value and instilling confidence in its business. These initiatives not only boost investors’ confidence but also positively impact the earnings per share.
A Key Risk
ABM Industries' current ratio (a measure of liquidity) at the end of the April-quarter stands at 1.18, lower than the current ratio of 1.41 reported at the end of the prior-year quarter. Decreasing current ratio is not desirable as it indicates that a company may have problems meeting its short-term debt obligations.
Image: Shutterstock
Here's Why You Should Retain ABM Industries' (ABM) Stock
ABM Industries Incorporated (ABM - Free Report) currently benefits from strategic acquisitions and investor-friendly steps.
ABM’s earnings are anticipated to grow 2% and 8.2% in 2022 and 2023, respectively. Shares of ABM Industries have rallied 18.7% in the year-to-date period compared with the 7.1% rise of the industry it belongs to.
Image Source: Zacks Investment Research
Factors That Augur Well
ABM Industries' strategy entails growth through strategic acquisitions and organic investment. The buyout of Able Services strengthens ABM’s engineering and technical services, expands its sustainability and energy efficiency offerings and bolsters its core businesses and key geographies.
ABM’s multi-year comprehensive strategic plan ELEVATE, focuses on providing clients with offerings that enhance transparency and efficiencies, develop its own talent management system capabilities, expand data usage and modernize the digital ecosystem.
We are also impressed with ABM Industries’ endeavors in rewarding its shareholders through dividend payments and share repurchases. In fiscal 2021, ABM paid out $51 million as dividends but did not repurchase any shares. In fiscal 2020, it returned $49.3 million via dividend payment and $5.1 million through share buyback. In fiscal 2019, ABM returned $47.7 million of dividends to its shareholders but did not repurchase any shares. Such moves underpin its commitment to creating shareholder value and instilling confidence in its business. These initiatives not only boost investors’ confidence but also positively impact the earnings per share.
A Key Risk
ABM Industries' current ratio (a measure of liquidity) at the end of the April-quarter stands at 1.18, lower than the current ratio of 1.41 reported at the end of the prior-year quarter. Decreasing current ratio is not desirable as it indicates that a company may have problems meeting its short-term debt obligations.
Zacks Rank and Stocks to Consider
ABM Industries currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the broader Zacks Business Services sector are Avis Budget Group, Inc. (CAR - Free Report) , Genpact Limited (G - Free Report) ) and CRA International, Inc. (CRAI - Free Report) .
Avis Budget sports a Zacks Rank #1 at present. CAR has an earnings growth rate of 108.4% for 2022.
Avis Budget delivered a trailing four-quarter earnings surprise of 69.5%, on average.
Genpact carries a Zacks Rank of 2 at present. G has a long-term earnings growth expectation of 12.3%.
Genpact delivered a trailing four-quarter earnings surprise of 10.1%, on average.
CRA International flaunts a Zacks Rank of 1, currently. CRAI has a long-term earnings growth expectation of 14.3%.
CRAI delivered a trailing four-quarter earnings surprise of 26%, on average.