For those looking to find strong Construction stocks, it is prudent to search for companies in the group that are outperforming their peers. Has James Hardie (JHX) been one of those stocks this year? A quick glance at the company's year-to-date performance in comparison to the rest of the Construction sector should help us answer this question.
James Hardie is one of 97 individual stocks in the Construction sector. Collectively, these companies sit at #5 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.
The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. James Hardie is currently sporting a Zacks Rank of #1 (Strong Buy).
The Zacks Consensus Estimate for JHX's full-year earnings has moved 9.3% higher within the past quarter. This is a sign of improving analyst sentiment and a positive earnings outlook trend.
Based on the most recent data, JHX has returned 98.3% so far this year. At the same time, Construction stocks have gained an average of 50.6%. This means that James Hardie is performing better than its sector in terms of year-to-date returns.
One other Construction stock that has outperformed the sector so far this year is Lennar (LEN). The stock is up 71.1% year-to-date.
Over the past three months, Lennar's consensus EPS estimate for the current year has increased 12.8%. The stock currently has a Zacks Rank #2 (Buy).
To break things down more, James Hardie belongs to the Building Products - Miscellaneous industry, a group that includes 27 individual companies and currently sits at #37 in the Zacks Industry Rank. This group has gained an average of 58.2% so far this year, so JHX is performing better in this area.
On the other hand, Lennar belongs to the Building Products - Home Builders industry. This 19-stock industry is currently ranked #71. The industry has moved +83.2% year to date.
James Hardie and Lennar could continue their solid performance, so investors interested in Construction stocks should continue to pay close attention to these stocks.
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