Leggett & Platt, Inc.
), the manufacturer of diverse engineered products and
components, remains on our Neutral list with a price target of
$35.00 per share.
A well-diversified customer base, pricing power and solid
research and development (R&D) capabilities, facilitates
Leggett & Platt to float in the soft economic environment. In
order to focus more on its core business operations and improve
financial flexibility, the company is continuously taking
strategic actions to add new products to its portfolio as per the
consumers' changing preferences while simultaneously divesting
We also remained impressed by Leggett's bottom line
performance in the recent concluded quarter. The company posted
earnings of 33 cents per share, which surged 10% from the
comparable year-ago quarter, mainly driven by a sturdy
operational performance comprising effective cost management,
better product mix in some businesses and the acquisition of
Western Pneumatic Tube.
Buoyed by strong bottom-line results, management raised the
lower end of its sales growth and earnings guidance for full-year
2013. The company now expects sales to rise in the range of 2-6%
and earnings to come at $1.55-1.75 per share. Earlier, Leggett
projected sales growth of 1-6% and earnings per share in the
range of $1.50-1.75. Currently, the Zacks Consensus Estimate for
2013 stands at $1.61 per share.
On the flip side, we remain concerned about increasing
material costs, intense competition and exposure to adverse
foreign currency translations. The company operates in a
competitive environment and strives to maintain its market share,
actively competing with numerous manufacturers and distributors
of consumer and commercial products.
Given the pros and cons inhibited in the stock we prefer to
remain on the sidelines, and maintain our Neutral recommendation.
This is also well supported by the company's current Zacks Rank
Other Stocks Worth Considering
Better performing stocks in the home furnishing appliances
Hooker Furniture Corp
Mohawk Industries Inc
Virco Mfg. Corporation
). Hooker and Mohawk have a Zacks Rank #1 (Strong Buy) while
Virco carries a Zacks Rank #2 (Buy).
HOOKER FURNITUR (HOFT): Free Stock Analysis
LEGGETT & PLATT (LEG): Free Stock Analysis
MOHAWK INDS INC (MHK): Free Stock Analysis
VIRCO MFG (VIRC): Get Free Report
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