With enhanced focus on capture the rising demand of plastics, solid order growth and cost-reduction initiatives, Milacron Holdings Corp.MCRN crafted a 52-week high of $19.45 on Jun 19, before closing at $19.33.
Milacron has a healthy year-to-date return of 3.8% and a solid one-year return of 17.3%. The company displays long-term earnings growth rate of 9.9%, making us confident of its innate strength.
Despite scaling a 52-week high, the company's share price has underperformed the Zacks categorized Manufacturing-Material Handling sector over the last 12 months. The current rate of return for the industry is 26.6%, while that of Milacron is 17.3%.
The stock has a market cap of $1.3 billion. Average volume of shares traded over the last three months was approximately 488K. We note that the company has beaten the Zacks Consensus Estimate in three out of the trailing four quarters, the average positive earnings surprise being 9.23%.
Milacron Holdings Corp. Price and Consensus
Demand for a diverse range of finished plastic products is on the rise in many markets, including automotive, construction and consumer products. Given its strong global presence, Milacron is well positioned to capture this growth. The company's strategy is focused on growing revenue and operating profits through selective initiatives that leverage its market position, geographic footprint and core competencies.
Since the past two years, Milacron has undertaken a number of organizational redesign, and cost-reduction initiatives to improve its cost structure and operating flexibility. These actions are anticipated to yield approximately $35 million of annual run-rate cost savings by the end of 2017.
Further, Milacron's orders in the quarter grew 12% year over year in first-quarter 2017. Orders grew at least 10% in consumer goods, electronics, and construction. Orders grew at a mid-single-digit rate in packaging and were flat in automotive. The solid order rates and ending backlog levels positions the company well to achieve 2017 guidance.
The company also continues to strategically reorganize its manufacturing base in order to shift resources to high-growth geographic markets.
Zacks Rank & Key Picks
Milacron currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same sector are Hyster-Yale Materials Handling, Inc. HY , Altra Industrial Motion Corp. AIMC and Parker-Hannifin Corporation PH . All three stocks boast a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .
Hyster-Yale Materials Handling has an average positive earnings surprise of 2.36% for the trailing four quarters. Altra Industrial Motion generated an average positive earnings surprise of 15.93% over the past four quarters, while Parker-Hannifin has an average positive earnings surprise of 14.94% for the last four quarters.
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