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Here's Why ITT Stock is a Suitable Pick for Your Portfolio
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Multi-sector stocks in the equity market have been gaining strength, of late, on the back of rising demand for air travel, technological upgrade in manufacturing processes, as well as improving operations in the oil and gas industry. Reduced corporate-tax rates, steaming-up industrial activity in the United States, and increased government spending will likely continue to benefit these companies.
Such multi-sector stocks are grouped under the Zacks Conglomerates sector that currently occupies the seventh position among the 16 Zacks sectors.
Among the numerous potential gainers within the sector, adding ITT Inc. (ITT - Free Report) to your portfolio will be a promising investment move at the moment. This stock currently carries a Zacks Rank #2 (Buy).
Price Performance
The above graph shows that on a month-to-date basis, ITT’s stock has rallied 9%, outperforming 1.5% and 2.5% growth recorded by the sector and the benchmark S&P 500 Group, respectively.
Why Should You Pick the Stock?
Solid Top-Line Prospects: ITT generated higher-than-anticipated revenues in third-quarter 2018, reflecting an organic year-over-year improvement of 7%. The company expects that increased orders from the chemical and general industrial businesses, sturdier demand for its specialized connectors, and growth in the company’s worldwide automotive friction orders will drive its revenue growth trajectory in the quarters ahead. In sync with this, ITT predicts to generate organic revenue growth of 4-5% in 2018, as against the previous view of 3-5%. Per our estimates, the company’s year-over-year revenue growth is currently pegged at 7% and 5% for 2018 and 2019, respectively.
Profitability: ITT pulled off a positive average earnings surprise of 5.72% in the past four quarters. The company expects that commercial excellence, increased productivity, lower tax expenses and stellar sales volumes will boost its profitability in the upcoming quarters. Notably, ITT has revised its earnings view for 2018 from $3.05-$3.15 to the $3.13-$3.15 per share range. This raised the mid-point of the earnings view from $3.10 per share to $3.14 per share. Per our estimates, the company’s year-over-year earnings growth is currently pinned at 21.6% and 13.9% for 2018 and 2019, respectively.
Highly Innovative: ITT intends to become more competent on the back of innovation investments. The company’s recently-rolled out innovative products like i-ALERT performance sensors and upgraded ITT Smart Pad have become widely popular in the market. Also, recent investments made to enhance the production capabilities and technology of rotorcraft will likely reap benefits.
Beneficial to Shareowners: ITT intends to augment its shareholders’ remuneration over time. Concurrent with the third-quarter earnings release, the company announced an incremental share repurchasing move of up to $25 million. ITT stated that it would buyback these shares with the cash proceeds secured from the spin-off of a former Connector operating location. Excluding this latest repurchase announcement, the company’s gross discretionary repurchases for 2018 stands at $75 million.
Other Stocks to Consider
Some other top-ranked stocks in the same space are listed below:
Macquarie Infrastructure Company currently sports a Zacks Rank #1 (Strong Buy). The company pulled off a positive average earnings surprise of 3.85% in the past four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.
Crane Company (CR - Free Report) carries a Zacks Rank #2. The company generated a positive average earnings surprise of 5.04% in preceding four quarters.
Federal Signal Corporation (FSS - Free Report) also holds a Zacks Rank of 2. The company delivered a positive average earnings surprise of 21.18% during the same time frame.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Here's Why ITT Stock is a Suitable Pick for Your Portfolio
Multi-sector stocks in the equity market have been gaining strength, of late, on the back of rising demand for air travel, technological upgrade in manufacturing processes, as well as improving operations in the oil and gas industry. Reduced corporate-tax rates, steaming-up industrial activity in the United States, and increased government spending will likely continue to benefit these companies.
Such multi-sector stocks are grouped under the Zacks Conglomerates sector that currently occupies the seventh position among the 16 Zacks sectors.
Among the numerous potential gainers within the sector, adding ITT Inc. (ITT - Free Report) to your portfolio will be a promising investment move at the moment. This stock currently carries a Zacks Rank #2 (Buy).
Price Performance
The above graph shows that on a month-to-date basis, ITT’s stock has rallied 9%, outperforming 1.5% and 2.5% growth recorded by the sector and the benchmark S&P 500 Group, respectively.
Why Should You Pick the Stock?
Solid Top-Line Prospects: ITT generated higher-than-anticipated revenues in third-quarter 2018, reflecting an organic year-over-year improvement of 7%. The company expects that increased orders from the chemical and general industrial businesses, sturdier demand for its specialized connectors, and growth in the company’s worldwide automotive friction orders will drive its revenue growth trajectory in the quarters ahead. In sync with this, ITT predicts to generate organic revenue growth of 4-5% in 2018, as against the previous view of 3-5%. Per our estimates, the company’s year-over-year revenue growth is currently pegged at 7% and 5% for 2018 and 2019, respectively.
Profitability: ITT pulled off a positive average earnings surprise of 5.72% in the past four quarters. The company expects that commercial excellence, increased productivity, lower tax expenses and stellar sales volumes will boost its profitability in the upcoming quarters. Notably, ITT has revised its earnings view for 2018 from $3.05-$3.15 to the $3.13-$3.15 per share range. This raised the mid-point of the earnings view from $3.10 per share to $3.14 per share. Per our estimates, the company’s year-over-year earnings growth is currently pinned at 21.6% and 13.9% for 2018 and 2019, respectively.
Highly Innovative: ITT intends to become more competent on the back of innovation investments. The company’s recently-rolled out innovative products like i-ALERT performance sensors and upgraded ITT Smart Pad have become widely popular in the market. Also, recent investments made to enhance the production capabilities and technology of rotorcraft will likely reap benefits.
Beneficial to Shareowners: ITT intends to augment its shareholders’ remuneration over time. Concurrent with the third-quarter earnings release, the company announced an incremental share repurchasing move of up to $25 million. ITT stated that it would buyback these shares with the cash proceeds secured from the spin-off of a former Connector operating location. Excluding this latest repurchase announcement, the company’s gross discretionary repurchases for 2018 stands at $75 million.
Other Stocks to Consider
Some other top-ranked stocks in the same space are listed below:
Macquarie Infrastructure Company currently sports a Zacks Rank #1 (Strong Buy). The company pulled off a positive average earnings surprise of 3.85% in the past four quarters. You can see the complete list of today’s Zacks #1 Rank stocks here.
Crane Company (CR - Free Report) carries a Zacks Rank #2. The company generated a positive average earnings surprise of 5.04% in preceding four quarters.
Federal Signal Corporation (FSS - Free Report) also holds a Zacks Rank of 2. The company delivered a positive average earnings surprise of 21.18% during the same time frame.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>