) reached a 52-week high of $107.93 on Friday, Dec 20, 2013.
However, the stock closed at $106.89, representing a one-year
return of about 36.0% and a healthy year-to-date return of about
32.2%. Average volume of shares traded over the last three months
stands at approximately 250,403.
The company witnessed growth across three of its four
businesses during the quarter. Planned strategic investments to
strengthen its mobile tool distribution network, proliferation in
the vehicle repair garage and expansion of critical industries
were important growth drivers. Expansion in the emerging markets
also contributed to strong performance in the quarter. The
company remains focused on more such strategic investments moving
Snap-on delivered positive earnings surprises in the last four
quarters with an average beat of 4.32%. This Zacks Rank #3 (Hold)
company has a market cap of $6.2 billion and a long-term expected
earnings growth rate of 9.5%.
Snap-on has been strengthening its business model by pursuing
geographic and customer diversification and also expanding its
presence in emerging markets and critical industries. This apart,
the company persists in strategic investments with the aim of
enhancing franchisee network, expanding the vehicle repair
garage, extending in critical industries and penetrating emerging
The company works under the Rapid Continuous Improvement (RCI)
process, which is designed to improve organizational
effectiveness and lower costs, including working capital
requirements. It has also helped improve sales, margins and
savings for the company. As a result, asset utilization has
developed by rationalizing production through plant closures, and
working capital has been used more effectively. Part of the RCI
process is the transformation of Snap-On's global manufacturing
and supply chain into a market-demand-based, lower-cost
The biggest advantage of Snap-on is its ability to innovate
which it has been doing so over the last 90 years. Snap-On has
invested in new products and increased brand awareness. The
company managed to create product excitement and real customer
value through a combination of innovation and customer connection
processes. These processes, when combined with RCI, enable
progress. Snap-On's Wisconsin lab, which is called Innovation
Works, combines both innovation and customer connection.
Improved Q313 Earnings
Snap-on Inc. reported stellar third-quarter 2013 results with
a healthy growth in net sales and earnings. Net income for the
quarter increased to $84.6 million or $1.43 per share from $74.1
million or $1.26 in the year-earlier quarter. The reported
earnings also beat the Zacks Consensus Estimate by 3 cents.
Despite continued macroeconomic headwinds, the company is
favorably benefited by the management's focus on enhancing van
network, growing business from repair shop owners and managers,
extending service to critical industries, strategic acquisitions
and expansion in emerging markets.
Net sales of the company were up 5.8% year over year to $753.2
million. Total revenue in the reported quarter increased to
$798.3 million from $752.1 million in the year-ago quarter.
Excluding inorganic revenues of $15.6 million from the May 2013
acquisition of Challenger Lifts, Inc. and adverse foreign
currency translation effects, organic sales climbed 4.7% year
Over the last 60 days, the estimates for 2013 and 2014
witnessed upward movement, with estimate for fiscal 2013 up 0.34%
to $5.89 and fiscal 2014 estimates increased 0.8% to $6.48.
Other Stocks to Consider
Snap-on currently has a Zacks Rank #3 (Hold). Investors
interested in the machinery and general industries sector can
DXP Enterprises, Inc.
). Xylem carries a Zacks Rank #1 (Strong Buy) while DXP
Enterprises and Graham have a Zacks Rank #2 (Buy).
DXP ENTERPRISES (DXPE): Free Stock Analysis
GRAHAM CORP (GHM): Free Stock Analysis Report
SNAP-ON INC (SNA): Free Stock Analysis Report
XYLEM INC (XYL): Free Stock Analysis Report
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