Earnings momentum for
Powell Industries, Inc.
) improved after this provider of custom engineered solutions
reported solid fiscal third quarter 2012 (ended June 30, 2012)
financial results, which included a 117.0% earnings surprise. This
Zacks #1 Rank (Strong Buy) offers an attractive opportunity for
growth-seeking investors given its long-term growth projection of
8.0%, solid backlog, strengthening demand in key end markets and
Upbeat Quarter Results/Promising Guidance
On August 7, Powell Industries, Inc. reported fiscal third quarter
2012 earnings of $1.02 per share, surpassing the Zacks Consensus
Estimate of 47 cents by 117.0% and way ahead of last year's one
Revenue improved 37.3% to $194.1 million, while new orders and
backlog were strong at $133 million and $433 million, respectively.
The quarter also witnessed successful execution of large capital
projects, especially in the international oil and gas as well as
light rail traction market.
Based on its impressive fiscal third quarter results and solid
backlog, management revised its guidance for the fiscal year 2012
and now expects revenue between $700 million and $725 million
versus the earlier expectation range of $675 million - $725
million. The earnings per share guidance has been revised to
between $1.95 and $2.20 from the range of $1.25 - $1.50.
Positive Earnings Momentum
Over the last 30 days, three of four estimates increased for fiscal
2012 (ending September 2012), leading to a 50.3% rise in the Zacks
Consensus Estimate to $2.18 per share. A similar trend followed for
fiscal year 2013, with three of four upward estimate revisions
leading to an 18.3% rise in the Zacks Consensus Estimate to $2.65
The Zacks Consensus Estimates represent year-over-year earnings
growth of 320.2% for fiscal 2012 and 21.3% for fiscal 2013.
Powell Industries, Inc. is currently trading at a price-to-sales
(P/S) ratio of 0.6, in line with the peer group average. On a
forward P/E basis, shares trade at 17.2x, versus the peer group
average of 10.2x. The company offers a ROE of 7.0%; same as its
peer group average.
The stock started gaining momentum in the second half of 2010. A
rising Zacks Consensus Estimate since the beginning of 2012 is
indicative of bright growth prospects for the stock in the years
Powell Industries, Inc. is based in Houston, Texas, and was
incorporated in 1947. It operates in the Industrial Electrical
Equipment sector; focusing primarily on manufacturing and supply of
custom engineered solutions for the transportation, environmental,
energy, industrial and utility industries. It currently has a
market capitalization of approximately $446 million.
POWELL INDS (POWL): Free Stock Analysis Report
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