On Feb 4, Zacks Investment Research upgraded
Manitowoc Company, Inc.
), a leading manufacturer of commercial foodservice equipment and
cranes, to a Zacks Rank #1 (Strong Buy).
Why the Upgrade?
On Jan 30, 2014, Manitowoc reported fourth-quarter earnings
per share of 47 cents, a 74% increase year over year helped by
sound performance in the Foodservice segment, successful
introduction of new products as well as the company's cost
control initiatives. The bottom line beat the Zacks Consensus
Estimate of 33 cents.
The upbeat earnings helped Manitowoc attain a new 52-week high
of $29.39 on Jan 31, up from its previous high of $26.01. The
share price gained 15% in a day and closed at $28.45 on Jan
For 2014, Manitowoc expects modest top-line growth in Crane
segment revenues. The company forecasts high single-digit
improvement in operating margins in the Crane segment.
Crane utilization and rental rates continue to improve with
demand. Going forward, demand from the wind sector as well as
from oil and gas markets is expected to grow. Manitowoc remains
optimistic regarding its new products, which include an array of
technologically advanced products that will be launched at
ConExpo, the premier construction-equipment trade show that is
slated to be held in Mar 2014. This could be a catalyst for the
Crane segment. A turnaround in the construction sector will also
boost Crane sales.
Foodservice revenues are expected to rise in mid-single digits
and the company expects high-teens gain in Foodservice segment
margins. The segment will be benefit from new manufacturing
facilities, restructuring initiatives and new products.
In Jan, 2014, Manitowoc announced that it has refinanced some
of its debt which is expected to save approximately $20 million
of interest expense in 2014.
Estimates for Manitowoc have also been going up following its
fourth-quarter earnings. For fiscal 2014, 5 out of 11 estimates
have gone up by 3% from $1.46 to $1.51 over the past 7 days. For
fiscal 2015, 2 out of 10 estimates have gone up by 8% to $1.90
over the same timeframe.
Other Stocks to Consider
Other players in the machinery industry, which look attractive
at current levels, include
Zebra Technologies Corp.
). While Middleby holds a Zacks Rank #1 (Strong Buy), Terex and
Zebra hold a Zacks Rank #2 (Buy).
MIDDLEBY CORP (MIDD): Free Stock Analysis
MANITOWOC INC (MTW): Free Stock Analysis
TEREX CORP (TEX): Free Stock Analysis Report
ZEBRA TECH CL A (ZBRA): Free Stock Analysis
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