Latest news with #Industrials
Yahoo
a day ago
- Business
- Yahoo
Returns On Capital Are Showing Encouraging Signs At Texchem Resources Bhd (KLSE:TEXCHEM)
If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an eye out for. One common approach is to try and find a company with returns on capital employed (ROCE) that are increasing, in conjunction with a growing amount of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. Speaking of which, we noticed some great changes in Texchem Resources Bhd's (KLSE:TEXCHEM) returns on capital, so let's have a look. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. What Is Return On Capital Employed (ROCE)? For those who don't know, ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. To calculate this metric for Texchem Resources Bhd, this is the formula: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.094 = RM40m ÷ (RM764m - RM339m) (Based on the trailing twelve months to March 2025). Thus, Texchem Resources Bhd has an ROCE of 9.4%. In absolute terms, that's a low return, but it's much better than the Industrials industry average of 7.6%. Check out our latest analysis for Texchem Resources Bhd Above you can see how the current ROCE for Texchem Resources Bhd compares to its prior returns on capital, but there's only so much you can tell from the past. If you'd like to see what analysts are forecasting going forward, you should check out our free analyst report for Texchem Resources Bhd . What Can We Tell From Texchem Resources Bhd's ROCE Trend? Even though ROCE is still low in absolute terms, it's good to see it's heading in the right direction. Over the last five years, returns on capital employed have risen substantially to 9.4%. The amount of capital employed has increased too, by 29%. This can indicate that there's plenty of opportunities to invest capital internally and at ever higher rates, a combination that's common among multi-baggers. On a separate but related note, it's important to know that Texchem Resources Bhd has a current liabilities to total assets ratio of 44%, which we'd consider pretty high. This effectively means that suppliers (or short-term creditors) are funding a large portion of the business, so just be aware that this can introduce some elements of risk. Ideally we'd like to see this reduce as that would mean fewer obligations bearing risks. The Bottom Line On Texchem Resources Bhd's ROCE A company that is growing its returns on capital and can consistently reinvest in itself is a highly sought after trait, and that's what Texchem Resources Bhd has. Since the stock has only returned 37% to shareholders over the last five years, the promising fundamentals may not be recognized yet by investors. So exploring more about this stock could uncover a good opportunity, if the valuation and other metrics stack up. On a final note, we found 2 warning signs for Texchem Resources Bhd (1 is concerning) you should be aware of. If you want to search for solid companies with great earnings, check out this free list of companies with good balance sheets and impressive returns on equity. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Automotive
- Yahoo
1 Industrials Stock with Solid Fundamentals and 2 Facing Challenges
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. But they are at the whim of volatile macroeconomic factors that sway capital spending, like interest rates. Wariness surrounding these influences has caused the industry to underperform the market as it was flat over the past six months while the S&P 500 climbed by 4.1%. The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. Taking that into account, here is one resilient industrials stock at the top of our wish list and two we're passing on. Two IndustrialsStocks to Sell: Hudson Technologies (HDSN) Market Cap: $357.4 million Founded in 1991, Hudson Technologies (NASDAQ:HDSN) specializes in refrigerant services and solutions, providing refrigerant sales, reclamation, and recycling. Why Does HDSN Fall Short? Annual sales declines of 15.5% for the past two years show its products and services struggled to connect with the market during this cycle Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term Shrinking returns on capital suggest that increasing competition is eating into the company's profitability Hudson Technologies's stock price of $8.22 implies a valuation ratio of 10.7x forward EV-to-EBITDA. To fully understand why you should be careful with HDSN, check out our full research report (it's free). MRC Global (MRC) Market Cap: $1.21 billion Producing bomb casings and tracks for vehicles during WWII, MRC (NYSE:MRC) offers pipes, valves, and fitting products for various industries. Why Are We Out on MRC? Customers postponed purchases of its products and services this cycle as its revenue declined by 2.9% annually over the last five years Earnings per share have contracted by 33.4% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance ROIC of 0.9% reflects management's challenges in identifying attractive investment opportunities At $14.05 per share, MRC Global trades at 11.9x forward P/E. If you're considering MRC for your portfolio, see our FREE research report to learn more. One Industrials Stock to Watch: Wabtec (WAB) Market Cap: $36.26 billion Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE:WAB) provides equipment, systems, and related software for the railway industry. Why Does WAB Stand Out? Core business is healthy and doesn't need acquisitions to boost sales as its organic revenue growth averaged 9.5% over the past two years Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage Share repurchases over the last two years enabled its annual earnings per share growth of 25.5% to outpace its revenue gains Wabtec is trading at $211.91 per share, or 24.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it's free. High-Quality Stocks for All Market Conditions Donald Trump's April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities. The smart money is already positioning for the next leg up. Don't miss out on the recovery - check out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
2 days ago
- Business
- Yahoo
3 Industrials Stocks We Think Twice About
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the market seems confused about where we could go next. This uncertainty has led to a flat return for the industry over the past six months while the S&P 500 was up 4.1%. Investors should tread carefully as timing cyclical companies is a challenging task, and any misstep can have you catching a falling knife. Keeping that in mind, here are three industrials stocks best left ignored. Rockwell Automation (ROK) Market Cap: $40.13 billion One of the first companies to address industrial automation, Rockwell Automation (NYSE:ROK) sells products that help customers extract more efficiency from their machinery. Why Is ROK Risky? Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable Eroding returns on capital suggest its historical profit centers are aging Rockwell Automation's stock price of $355.02 implies a valuation ratio of 35.6x forward P/E. To fully understand why you should be careful with ROK, check out our full research report (it's free). ArcBest (ARCB) Market Cap: $1.80 billion Historically owning furniture, banking, and other subsidiaries, ArcBest (NASDAQ:ARCB) offers full-truckload, less-than-truckload, and intermodal deliveries of freight. Why Should You Sell ARCB? Declining unit sales over the past two years show it's struggled to increase its sales volumes and had to rely on price increases Earnings per share have dipped by 32.9% annually over the past two years, which is concerning because stock prices follow EPS over the long term Shrinking returns on capital suggest that increasing competition is eating into the company's profitability ArcBest is trading at $78.54 per share, or 12.3x forward P/E. If you're considering ARCB for your portfolio, see our FREE research report to learn more. Universal Logistics (ULH) Market Cap: $662.3 million Founded in 1932, Universal Logistics (NASDAQ:ULH) is a provider of customized transportation and logistics solutions operating throughout the United States and in Mexico, Canada, and Colombia. Why Do We Pass on ULH? Sales tumbled by 5.1% annually over the last two years, showing market trends are working against its favor during this cycle Earnings per share have contracted by 22.9% annually over the last two years, a headwind for returns as stock prices often echo long-term EPS performance Free cash flow margin shrank by 9.6 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive At $25.15 per share, Universal Logistics trades at 8x forward P/E. Check out our free in-depth research report to learn more about why ULH doesn't pass our bar. Stocks We Like More Trump's April 2024 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines. Take advantage of the rebound by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
08-07-2025
- Business
- Yahoo
Is Invesco S&P MidCap 400 GARP ETF (GRPM) a Strong ETF Right Now?
Launched on 12/03/2010, the Invesco S&P MidCap 400 GARP ETF (GRPM) is a smart beta exchange traded fund offering broad exposure to the Style Box - Mid Cap Blend category of the market. Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry. Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way. However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta. Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance. Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results. The fund is managed by Invesco, and has been able to amass over $465 million, which makes it one of the average sized ETFs in the Style Box - Mid Cap Blend. Before fees and expenses, this particular fund seeks to match the performance of the S&P MIDCAP 400 GARP INDEX . The S&P MidCap 400 GARP Index seeks to track companies with consistent fundamental growth, reasonable valuation, solid financial strength, and strong earning power. For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same. Annual operating expenses for GRPM are 0.35%, which makes it on par with most peer products in the space. The fund has a 12-month trailing dividend yield of 0.89%. It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis. GRPM's heaviest allocation is in the Consumer Discretionary sector, which is about 26.3% of the portfolio. Its Energy and Industrials round out the top three. Looking at individual holdings, Celsius Holdings Inc (CELH) accounts for about 4.67% of total assets, followed by Halozyme Therapeutics Inc (HALO) and Roivant Sciences Ltd (ROIV). The top 10 holdings account for about 27.7% of total assets under management. The ETF has lost about -0.64% and was up about 0.07% so far this year and in the past one year (as of 07/08/2025), respectively. GRPM has traded between $90.38 and $126.41 during this last 52-week period. The fund has a beta of 1.09 and standard deviation of 21.81% for the trailing three-year period. With about 60 holdings, it effectively diversifies company-specific risk . Invesco S&P MidCap 400 GARP ETF is a reasonable option for investors seeking to outperform the Style Box - Mid Cap Blend segment of the market. However, there are other ETFs in the space which investors could consider. Vanguard Mid-Cap ETF (VO) tracks CRSP US Mid Cap Index and the iShares Core S&P Mid-Cap ETF (IJH) tracks S&P MidCap 400 Index. Vanguard Mid-Cap ETF has $84 billion in assets, iShares Core S&P Mid-Cap ETF has $96.42 billion. VO has an expense ratio of 0.04% and IJH changes 0.05%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Mid Cap Blend To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. 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 Invesco S&P MidCap 400 GARP ETF (GRPM): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
07-07-2025
- Business
- Yahoo
Should You Invest in the iShares U.S. Transportation ETF (IYT)?
The iShares U.S. Transportation ETF (IYT) was launched on 10/06/2003, and is a passively managed exchange traded fund designed to offer broad exposure to the Industrials - Transportation/Shipping segment of the equity market. Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors. Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Transportation/Shipping is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 4, placing it in top 25%. The fund is sponsored by Blackrock. It has amassed assets over $713.57 million, making it one of the average sized ETFs attempting to match the performance of the Industrials - Transportation/Shipping segment of the equity market. IYT seeks to match the performance of the Dow Jones Transportation Average Index before fees and expenses. The S&P Transportation Select Industry FMC Capped Index (USD) measures the performance of companies from the Industrial Transportation, Airline and General Industrial Services industries of the U.S. equity market. Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same. Annual operating expenses for this ETF are 0.39%, making it one of the cheaper products in the space. It has a 12-month trailing dividend yield of 1.07%. While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis. This ETF has heaviest allocation in the Industrials sector--about 100% of the portfolio. Looking at individual holdings, Uber Technologies Inc (UBER) accounts for about 22.28% of total assets, followed by Union Pacific Corp (UNP) and United Parcel Service Inc Class B (UPS). The top 10 holdings account for about 75.77% of total assets under management. The ETF return is roughly 5.13% so far this year and it's up approximately 9.77% in the last one year (as of 07/07/2025). In that past 52-week period, it has traded between $55.22 and $75.40. The ETF has a beta of 1.24 and standard deviation of 22.28% for the trailing three-year period, making it a high risk choice in the space. With about 49 holdings, it has more concentrated exposure than peers. IShares U.S. Transportation ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, IYT is a good option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space. SPDR S&P Transportation ETF (XTN) tracks S&P Transportation Select Industry Index and the U.S. Global Jets ETF (JETS) tracks U.S. Global Jets Index. SPDR S&P Transportation ETF has $179.75 million in assets, U.S. Global Jets ETF has $861.08 million. XTN has an expense ratio of 0.35% and JETS charges 0.60%. To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. 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 iShares U.S. Transportation ETF (IYT): ETF Research Reports Union Pacific Corporation (UNP) : Free Stock Analysis Report United Parcel Service, Inc. (UPS) : Free Stock Analysis Report U.S. Global Jets ETF (JETS): ETF Research Reports SPDR S&P Transportation ETF (XTN): ETF Research Reports Uber Technologies, Inc. (UBER) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
