) has been enjoying enhanced earnings momentum due to upbeat first
quarter results and attractive acquisitions, helping this label
solution provider achieve a Zacks #1 Rank (Buy). In addition, with
a P/B of just 1.28 and a P/S multiple of 0.56, this stock is an
attractive pick for value investors.
A Good Beginning to Fiscal 2013
Multi-Color announced fiscal first-quarter results on August 7 with
adjusted earnings per share of 55 cents surpassing the Zacks
Consensus Estimate by 10%. The better-than-expected results were
primarily aided by robust top-line growth. In the year-ago quarter,
EPS was 66 cents.
Net revenue surged 64.0% year over year to $165.0 million, mainly
benefiting from its April acquisition of Scottish wine and spirits
label maker Labelgraphics Holdings for $24.6 million. Organic net
revenues inched up 2%, thanks to a favorable pricing and sales mix.
Adjusted gross profit advanced 41% to $31.4 million while operating
income expanded 31% to $18.7 million, as a result of the
acquisitions partially offset by unfavorable currency impact.
Adjusted SG&A expenses also spiked 60%, due to the
Earnings Momentum Moving Uphill
Over the last 30 days, the Zacks Consensus Estimate for 2012
increased 3.9% to $2.13 per share with two of three estimates
revised upward. This implies a year-over-year growth of about
15.0%. For 2013, one of 2 estimates moved higher, helping the Zacks
Consensus Estimate improve 6.8% to $2.35. The estimate for 2013
represents a year-over-year increase of approximately 10.5%.
In addition to low P/S and P/B multiples, the stock looks
attractive with respect to a forward price-to-earnings (P/E)
multiple of just 9.41. A P/E below 15.0, a P/S ratio less than 1.0
and a P/B ratio under 3.0 generally suggests a value stock.
Additionally, it currently enjoys a fabulous dividend yield of
1.00%. Therefore, in addition to being a value stock, the company
also offers a steady income opportunity.
Batavia, Ohio-based Multi-Color is a label manufacturer with a
market capitalization of approximately $322.7 million. The company
serves leading producers of home and personal care, food and
beverage, wine and spirit, and specialty consumer products.
Multi-Color was established in 1961 and primarily competes with
Valassis Communications Inc (
) and Schawk Inc (
MULTI-COLOR (LABL): Free Stock Analysis Report
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