Markets
KRA

6 Reasons That Make Kronos Worldwide an Attractive Pick

Kronos Worldwide, Inc. 's KRO stock looks promising at the moment. The company, currently carrying a Zacks Rank #1 (Strong Buy), has seen its shares shoot up roughly 122% year to date. If you haven't taken advantage of the share price appreciation yet, the time is right for you to add the stock to portfolio as it looks promising and is poised to carry the momentum ahead.

Let's delve deeper into the factors that make this chemical maker an attractive investment option.

What's Working in Favor of Kronos?

An Outperformer: Kronos has significantly outperformed the industry it belongs to over a year. The company's shares have gained a whopping 127.1% over this period, compared with roughly 27.2% gain recorded by the industry.

Estimates Moving Up: Annual estimates for Kronos have moved north over the past three months, reflecting analysts' confidence on the stock. Over this period, the Zacks Consensus Estimate for 2017 has increased by around 6.6% to $1.61 per share. The Zacks Consensus Estimate for 2018 has also moved up 18% over the same timeframe to $2.16.

Positive Earnings Surprise History: Kronos has outpaced the Zacks Consensus Estimate in three of the trailing four quarters, delivering a positive average earnings surprise of 58.8%.

Strong Growth Prospects: The Zacks Consensus Estimate for earnings for 2017 is currently pegged at $1.61, reflecting an expected year-over-year growth of 419.4%. Moreover, earnings are expected to register a 34.2% growth in 2018. The stock also has a long-term (three-five years) expected earnings per share growth rate of 5%.

Superior Return on Equity (ROE): Kronos' ROE of 31.4%, as compared with the industry average of 10.7%, manifests the company's efficiency in utilizing shareholder's funds.

Strong Q3 and Upbeat Outlook: The company's earnings of 64 cents per share for third-quarter 2017 climbed from 19 cents a year ago and also topped the Zacks Consensus Estimate of 45 cents. Higher average selling prices and increased sales and production volumes provided a boost to the company's earnings.

Net revenues jumped around 30% year over year to $464.5 million, on the back of higher titanium dioxide (TiO2) selling prices and increased sales volumes. Sales beat the Zacks Consensus Estimate of $448 million.

Kronos expects its production volumes to be higher in 2017 on a year-over-year basis as production rates this year will be favorably impacted by the implementation of certain productivity-enhancing improvement projects at some facilities. Also, the company anticipates increased sales volume in 2017 compared to 2016.

The company also envisions income from operations in 2017 will be higher on a year-over-year basis, mainly due to an expected increase in average selling prices and the favorable impact of anticipated higher production and sales volumes in 2017.

Kronos Worldwide Inc Price and Consensus

Kronos Worldwide Inc Price and Consensus | Kronos Worldwide Inc Quote

Other Stocks to Consider

Other top-ranked companies in the basic materials space include Westlake Chemical Corporation WLK , Ingevity Corporation NGVT and Kraton Corporation KRA , all sporting a Zacks Rank #1. You can see the complete list of today's Zacks #1 Rank stocks here .

Westlake has an expected long-term earnings growth of 8.4%. Its shares are up roughly 62% year to date.

Ingevity has an expected long-term earnings growth of 12%. The stock has gained around 34% year to date.

Kraton has an expected earnings growth of 25.4% for the current year. Its shares are up roughly 67% year to date.

Zacks' Best Private Investment Ideas

While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public.

Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors.

Click here for Zacks' private trades >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Kronos Worldwide Inc (KRO): Free Stock Analysis Report

Westlake Chemical Corporation (WLK): Free Stock Analysis Report

Kraton Corporation (KRA): Free Stock Analysis Report

Ingevity Corporation (NGVT): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

KRA KRO WLK NGVT

Other Topics

Stocks

Latest Markets Videos

Zacks

Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com.

Learn More