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Here's Why Investors Should Bet on Carlisle (CSL) Stock Now

Zacks Equity Research

Carlisle Companies Incorporated CSL has impressed investors with its recent earnings streak. It surpassed estimates thrice in the four trailing quarters, the positive average earnings surprise being 19.07%.

Over the past three months, the company has gained 11.6%, outperforming the industry’s  growth of 1.5%. Its share price performance exhibits investor optimism over the stock.

The company currently sports a Zacks Rank #1 (Strong Buy).We believe that its notable traction across markets will benefit it in the upcoming quarters.

Factors to Consider

Carlisle is well poised to gain from its diversified business structure, which enables it to tap opportunities and neutralize operating risks associated with a single market. Of late, one of the company's major segments — Carlisle Construction Materials — has been performing exceedingly well. In first-quarter 2019, strong organic growth, solid backlog, high volume of reroofing projects in the North American non-residential construction markets, and the acquisition of Petersen Aluminum Corporation (January 2019) benefited the segment substantially.

Also, continued strength in aerospace and defense markets as well as solid med-tech platform and SatCom markets have set the tone for strong future growth. As a matter of fact, the company anticipates overall revenue growth to be in the high single-digit for 2019, driven by the continued operational improvements, including cost savings from the Carlisle Operating System and positive market conditions.

Over the past several quarters, Carlisle has consistently returned significant cash to shareholders through dividends and share repurchases. Notably, in the first quarter of 2019, the company repurchased approximately $157 million of its shares. Further, it paid dividends worth $23 million during the quarter.Such diligent capital deployment strategies boost shareholders' wealth.

In addition, the company’s earnings estimates have been trending north over the past month, with one upward estimate revision for 2019. Notably, the Zacks Consensus Estimate for 2019 earnings is pegged at $7.82, higher than $7.80 estimated a month ago.

Other Key Picks

Some other top-ranked stocks in the same space are HC2 Holdings, Inc. HCHC, ITT Inc. ITT and Crane Co. CR. While HC2 Holdings sports a Zacks Rank #1, ITT and Crane carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

HC2 Holdings’ earnings surprise in the last reported quarter was a positive 92.73%.

ITT surpassed estimates in each of the trailing four quarters, the average positive earnings surprise being 7.02%.

Crane outpaced estimates in each of the preceding four quarters, the average earnings surprise being 6.74%.

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