Here's Why TriMas Stock is an Attractive Investment Option
TriMas Corporation TRS remains well poised for growth on the back of robust end market demand, focus on improving cost structure and momentum in its segments. IT growth prospects are further strengthened by its focus on leveraging the TriMas Business Model and strong pipeline of both product and process innovation.
The maker of engineered and applied products, with a market capitalization of approximately $1.4 billion, carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Let’s delve deeper into the factors that make this stock an attractive investment option.
Northbound Estimates: A positive trend in estimate revisions reflects optimism over the company's prospects. Over the past 90 days, the Zacks Consensus Estimate for earnings for both fiscal 2019 and fiscal 2020 has moved up 2%.
Positive Growth Projections: The Zacks Consensus Estimate for earnings for fiscal 2019 is pegged at $1.91, indicating an improvement of 9.14% from the year-ago quarter. For fiscal 2020, the Zacks Consensus Estimate is anticipated to advance 7.50% to $2.05 per share.
Positive Earnings Surprise History: The company has surpassed the Zacks Consensus Estimate in three of the trailing four quarters, with an average beat of 4.56%.
Strong Q1 Results: TriMas Corporation delivered adjusted earnings of 46 cents per share in first-quarter 2019 which surpassed the Zacks Consensus Estimate of 42 cents. The bottom line also improved 12% from 41 cents reported in the prior-year period.
The company generated revenues of $221.3 million in the reported quarter, missing the Zacks Consensus Estimate of $225 million. The top-line figure improved 2% year over year on account of organic and acquisition-related sales growth which was partially offset by the unfavorable impact of currency exchange.
Upbeat 2019 Guidance: Backed by continued growth across all markets, the company anticipates organic sales growth of 3% to 5% in 2019. Operating profit is expected to be within the range of 16% to 17%. Adjusted earnings per share in 2019 is expected to lie between $1.82 and $1.92. The mid-point of the guidance reflects year-over-year increase of approximately 7%.
Key Catalysts: In 2019, the company will continue to focus on TriMas Business Model in order to position its businesses better to drive growth via innovation, and capitalize on market opportunities through manufacturing efficacy. General industrial activity levels have improved, particularly in the United States, and this bodes well for TriMas. The company is well poised to take advantage of the incremental volume opportunities and continues to capitalize on its internal sales growth programs. The company has refocused certain commercial efforts, including realigning and enhancing sales functions, and improvement of cost structure.
The company also has a strong pipeline of both product and process innovation that will sustain long-term growth. Consequently, this positions it well to capitalize on market opportunities and minimize market disruptions.
The stock has an estimated long-term earnings growth rate of 5%.
Price Performance: Shares of TriMas have dropped around 2% over the past year, compared with the industry’s decline of 27%.
Overall the industry has been hit by the implementation of tariffs, resulting in higher material costs. The company plans to counter the impact of higher commodity costs and the impact of tariffs through commercial actions, supply chain management, leveraging its global manufacturing footprint and continued management of businesses under the TriMas Business Model.
Other Stocks to Consider
Some other top-ranked stocks in the Industrial Products sector are Chart Industries, Inc. GTLS, Lawson Products, Inc. LAWS and Harsco Corporation HSC, each sporting a Zacks Rank #1, at present.
Chart Industries has an estimated earnings growth rate of 52.9% for the ongoing year. The company’s shares have gained 9.3%, in the past year.
Lawson Products has an expected earnings growth rate of 24.5% for the current year. The stock has appreciated 39.3% in a year’s time.
Harsco has a projected earnings growth rate of 9.1% for 2019. The company’s shares have gained 5.4% over the past year.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.