2 Improved stocks in the industrial sector
Recession concerns and the inflationary environment are of concern to investors looking to take advantage of the economic recovery. However, the U.S. economy added slightly more jobs than expected in April as nonfarm payrolls increased by 428,000slightly above the Dow Jones estimate of 400,000.
According to a report by the Federal Reserve, total industrial production increased to a 8.1% annual rate for the first quarter. Additionally, President Joe Biden $1 trillion bipartisan infrastructure billwhich includes $550 billion in new spending for the construction of roads, railways and bridges, is expected to help the sector grow significantly over the coming months.
Against this backdrop, it might make sense to bet on fundamentally sound industrial stocks Robert Half International Inc. (IRI) and Franklin Electric Co., Inc. (CRACKED), which have been falling lately but harbor substantial upside potential.
Click here to view our Industrial Sector Report for 2022
Robert Half International Inc. (IRI)
RHI provides recruitment and risk consulting services in North America, South America, Europe, Asia and Australia. The company operates through temporary staffing and consultants; permanent placement endowment; risk advice; and internal audit services. B of A Securities moved the stock from Neutral to Buy.
On May 3, 2022, RHI announced that its Board of Directors had approved a quarterly cash dividend of $0.43 per share. The cash dividend will be paid on June 15, 2022 to all shareholders of record as of May 25, 2022.
RHI’s net sales increased 29.8% year-over-year to $1.81 billion in the first quarter, which ended March 31, 2022. The company’s net income increased is set at $168.24 million, representing a 52.1% year-over-year increase. Additionally, its EPS came in at $1.52, up 55.1% year-over-year.
Analysts expect RHI’s EPS and revenue to grow 19.5% and 28.7% year-over-year to $1.59 billion and $1.90 billion, respectively, for the quarter ending June 30, 2022. In addition, it exceeded consensus EPS estimates in each of the last four. quarters. The stock has gained 10.7% over the past year to close yesterday’s trading session at $98.74.
RHI POWR Rankings reflect this promising prospect. The company has an overall rating of B, which translates to Buy in our proprietary rating system. POWR ratings rate stocks on 118 different factors, each with its own weighting.
The stock has an A rating for quality and a B rating for value. RHI is ranked #7 out of 18 stocks within the A rating Outsourcing – Staffing Services industry. Click here to also see RHI’s rating for Stability, Growth, Momentum and Sentiment.
Franklin Electric Co., Inc. (CRACKED)
FELE designs, manufactures and distributes water and fuel pumping systems worldwide. It operates through three segments: Water Systems, Refueling Systems and Distribution. The company sells its products to wholesale and retail distributors, specialty distributors, original equipment manufacturers, industrial and petroleum equipment distributors, as well as petroleum and utility companies. . Seaport Global has improved the previous rating from Neutral to Buy.
On April 25, 2022, FELE announced that its Board of Directors had declared a quarterly cash dividend of $0.20 per share payable May 19, 2022 to shareholders of record May 5, 2022.
FELE’s net sales increased 36% year-over-year to $451.50 million in the first quarter, which ended March 31, 2022. The company’s operating profit increased up 18% year-on-year to $39.90 million, while its net profit was $30.12. million, representing a 6.9% year-over-year increase. Also, his PES stood at $0.63, up 6.8% year-over-year.
For the quarter ending June 30, 2022, analysts expect FELE’s EPS to be $1.05, representing a 26.5% year-over-year increase. It has exceeded consensus EPS estimates in each of the past four quarters. Additionally, its revenue is expected to grow 21.3% year-over-year to $2.02 billion in fiscal 2022.
FELE’s strong fundamentals are reflected in its POWR ratings. We rated FELE for Growth, Momentum, Stability, Sentiment, Quality and Value. Click here to access all FELE ratings. FELE is ranked No. 14 out of 37 stocks in the A rating Industrial – Manufacturing industry.
Shares of RHI remained unchanged after hours trading on Friday. Year-to-date, the RHI is down -12.64%, compared to a -13.13% rise in the benchmark S&P 500 over the same period.
About the Author: Nimesh Jaiswal
At Nimesh Jaiswal His passionate interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving the price of a stock is the key approach he follows while advising investors in his articles. After…