Stock Worth Buying: NL Industries - Analyst Blog

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Zacks Investment Research upgraded NL Industries Inc. ( NL ) to a Zacks Rank #1 (Strong Buy) on Jul 8, 2014. Going by the Zacks model, companies holding a Zacks Rank #1 have strong chances of performing better than the broader market.

Why the Upgrade?

NL Industries' better-than-expected first-quarter 2014 results have boosted investors' confidence. As a result, the company's share price have risen 1.7% since May 8, 2014.

The company posted earnings of 8 cents per share, a remarkable recovery from the loss of 4 cents per share incurred in the prior-year quarter. Also, the bottom-line results surpassed the Zacks Consensus Estimate of 2 cents of loss per share.

Revenues grew 20% to $25.8 million, driven by strong demand for CompX's security products. However, revenue growth was partially offset by increase in cost of sales. Gross profit increased 30% year over year with gross margin up by 220 basis points.

Impressive results triggered upward revisions in earnings estimates for NL Industries. Over the past 60 days, the Zacks Consensus Estimate has gone up by 40.6% to 45 cents for 2014 and 11.1% to 50 cents for 2015. These consensus estimates represent year-over-year growth of 139.5% for 2014 and 11.1% for 2015.

Other Stocks to Consider

NL Industries has a $473 million market capitalization. Other companies worth considering in the industry include KMG Chemicals Inc. ( KMG ), RTI International Metals, Inc. ( RTI ) and Minerals Technologies Inc. ( MTX ). All these stocks sport a Zacks Rank #1 (Strong Buy).

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MINERAL TECH (MTX): Free Stock Analysis Report

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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.

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

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