Markets
MT

Innospec (IOSP) Upgraded to Buy on Healthy Q1 and Prospects

An image of a stock chart
Credit: Shutterstock photo

On May 16, Zacks Investment Research upgraded chemical maker, Innospec Inc.IOSP to a Zacks Rank #2 (Buy). Going by the Zacks model, companies carrying a Zacks Rank #2 have higher chances of outperforming the broader market.

Why the Upgrade?

Innospec posted a profit of $17.2 million or 70 cents per share in first-quarter 2017, down around 9% from $18.9 million or 77 cents a year ago. Barring one-time items, earnings were $1.00 per share for the quarter, coming ahead of the Zacks Consensus Estimate of 95 cents.

The company's revenues grew 39% year over year to $294.3 million in the quarter. The company witnessed higher sales across core business segments in the reported quarter.

Innospec Inc. Price and Consensus

Innospec Inc. Price and Consensus | Innospec Inc. Quote

Innospec is well positioned to record strong growth in all its businesses. The company will continue to integrate its recent acquisitions and will also pursue other strategic buyouts to boost its portfolio.

In the first quarter, Innospec noted that demand across Performance Chemicals, Oilfield Services and Octane Additives segments improved greatly. While sales of Performance Chemicals jumped three-fold year over year on the back of recent acquisitions, revenues from Oilfield Services and Octane Additives units surged 84% and 61% year over year, respectively, in the quarter.

The company also hiked its semi-annual dividend by 15% to 38 cents per common share for first-half 2017. The dividend will be paid on May 31 to shareholders of record as of May 22.

Innospec's shares have also rallied 34.7% in the last one year, outperforming the Zacks categorized Chemicals-Diversified industry's gain of 18.6%.

Other Stocks to Consider

Other top ranked companies in the basic materials space include Kronos Worldwide, Inc. KRO , Methanex Corporation MEOH and ArcelorMittal MT . All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 stocks here .

Kronos has an expected long-term earnings growth of 5%.

Methanex has an expected long-term earnings growth of 15%.

ArcelorMittal has an expected long-term earnings growth of 11.4%.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think. See This Ticker Free >>

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

Methanex Corporation (MEOH): Free Stock Analysis Report

Kronos Worldwide Inc (KRO): Free Stock Analysis Report

Innospec Inc. (IOSP): Free Stock Analysis Report

ArcelorMittal (MT): 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

MT MEOH KRO IOSP

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