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Universal Stainless (USAP) Shares Scale 52-Week High: Here's Why

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Universal Stainless & Alloy Products, Inc. (USAP - Free Report) shares reached a fresh 52-week high of $34.75 on May 28, before closing at $34.47.

In the past year, the stock has surged 188% compared with the industry’s 19.5% rise in the same period.

Zacks Investment Research
Image Source: Zacks Investment Research

What’s Driving Universal Stainless?

In first-quarter 2024, USAP exhibited robust performance, marking a notable turnaround from the prior year’s figures. The company reported earnings of 43 cents per share, an improvement from a loss of 6 cents per share a year ago. This showcases its resilient strategy and strategic advancements.

USAP achieved remarkable sales growth, reaching $77.6 million and increasing 18% from the prior-year quarter’s tally. The upside was primarily driven by outstanding performances in the specialty alloys and premium alloys segments, which registered impressive year-over-year increases of 18% and 14%, respectively. The aerospace sector, in particular, was notable, with sales surging approximately 23% to $60.2 million. This underscores USAP's strong position in this critical market segment.

USAP's strategic focus on diversification and innovation is evident in its sales distribution across various end markets. While aerospace remains a cornerstone of its success, the company demonstrated adaptability and resilience by achieving growth in sectors such as heavy equipment and general industrial, strengthening its overall market presence.

The company achieved its highest profitability in 12 years in the first quarter, with a gross margin of 18.9% on near-record sales. This performance was driven by robust aerospace demand and the continued realization of base price increases implemented in the past three years.

USAP has a trailing four-quarter average earnings surprise of 44.4%. The Zacks Consensus Estimate for 2024 earnings is pegged at $1.50 per share, indicating a surge of 183% from the previous year’s levels.

 

Zacks Rank & Key Picks

Universal Stainlesscurrently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Basic Materials space are Carpenter Technology Corporation (CRS - Free Report) and ATI Inc. (ATI - Free Report) , eachsporting a Zacks Rank #1 (Strong Buy), and Ecolab Inc. (ECL - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

CRS’ earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company’s shares have soared 150.2% in the past year.

ATI’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the earnings surprise being 8.34%, on average. The company’s shares have surged 77.2% in the past year.

The Zacks Consensus Estimate for Ecolab's current-year earnings is pegged at $6.59, indicating a year-over-year rise of 26.5%. The Zacks Consensus Estimate for ECL’s current-year earnings has moved up in the past 30 days. ECL beat the consensus estimate in each of the last four quarters, with the earnings surprise being 1.3%, on average. The stock has rallied nearly 38% in the past year.


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