Shares of Johnson Controls Inc. (JCI) hit a new 52-week high of $36.93 on May 13, which is above its previous level of $36.55, and closed at $36.82 on the same date. The closing price represented a solid one-year return of 19.3% and year-to-date return of 18.0%.
Johnson Controls is a diversified industrial company that caters to automotive, building and power solutions market at the same time. It has a market cap of $25.2 billion. Average volume of shares traded over the last three months stood at approximately 4,830.31K.
Shares of the company started escalating, following its impressive guidance despite disappointing fiscal 2013-second quarter results released on Apr 23.
Johnson Controls posted a 23.6% decline in adjusted earnings to 42 cents per share in the second quarter of fiscal 2013 ended Mar 31, 2013 from 55 cents in the same quarter of prior fiscal year, but earnings were in line with the Zacks Consensus Estimate. Net income declined 24.1% to $287.0 million from $378.0 million in the second quarter of fiscal 2012.
Revenues in the quarter declined 1.3% $10.43 billion but marginally exceeded the Zacks Consensus Estimate of $10.39 billion. The decline was attributable to lower revenues in the company’s Automotive Experience and Building Efficiency segments.
Johnson Controls reiterated its guidance to generate earnings between $2.60 and $2.70 per share in fiscal 2013, which is higher than $2.56 in fiscal 2012. For the third quarter of fiscal 2013, the company expects earnings per share of 75 cents.
The company also expects that it will record better performance in the second half of 2013 due to benefits from restructuring initiatives, higher profitability from the Building Efficiency segment and improvements in European and South American Automotive Experience businesses. It also expects Power Solutions business to record higher profitability in the second half of fiscal 2013.
Currently, shares of Johnson Controls retain a Zacks Rank #3, which translates into a short-term rating (1–3 months) of Hold. Some other stocks that are performing well in the broader industry where Johnson Controls operates include STRATTEC Security Corporation (STRT), Tower International, Inc. (TOWR) and Visteon Corp. (VC). All these companies carry a Zacks Rank #1 (Strong Buy).
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