Latest news with #capitalintensity
Yahoo
11 hours ago
- Business
- Yahoo
2 Industrials Stocks to Own for Decades and 1 to Approach with Caution
Even if they go mostly unnoticed, industrial businesses are the backbone of our country. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the market seems to be baking in a prolonged downturn as the industry has shed 2.3% over the past six months. This drop was disappointing since the S&P 500 stood firm. The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. On that note, here are two industrials stocks boasting durable advantages and one we're swiping left on. Market Cap: $14.18 billion Started in 1926 as an insulation contractor, APi (NYSE:APG) provides life safety solutions and specialty services for buildings and infrastructure. Why Does APG Worry Us? Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 3.9 percentage points Underwhelming 3% return on capital reflects management's difficulties in finding profitable growth opportunities At $51.54 per share, APi trades at 24.3x forward P/E. Check out our free in-depth research report to learn more about why APG doesn't pass our bar. Market Cap: $69.97 billion Inventing the first forged aluminum truck wheel, Howmet (NYSE:HWM) specializes in lightweight metals engineering and manufacturing multi-material components used in vehicles. Why Should You Buy HWM? Impressive 12.7% annual revenue growth over the last two years indicates it's winning market share this cycle Share repurchases have amplified shareholder returns as its annual earnings per share growth of 40.5% exceeded its revenue gains over the last two years Free cash flow margin grew by 12.6 percentage points over the last five years, giving the company more chips to play with Howmet is trading at $173.73 per share, or 51.2x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it's free. Market Cap: $7.36 billion With a significant portion of its products made from recycled materials, AZEK (NYSE:AZEK) designs and manufactures goods for outdoor living spaces. Why Are We Bullish on AZEK? Existing business lines can expand without risky acquisitions as its organic revenue growth averaged 12.5% over the past two years Share buybacks catapulted its annual earnings per share growth to 56.9%, which outperformed its revenue gains over the last two years Free cash flow margin increased by 8.8 percentage points over the last five years, giving the company more capital to invest or return to shareholders AZEK's stock price of $51.19 implies a valuation ratio of 33.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. 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-small-cap company Comfort Systems (+782% 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
Yahoo
30-05-2025
- Business
- Yahoo
1 Industrials Stock with Solid Fundamentals and 2 to Be Wary Of
Whether you see them or not, industrials businesses play a crucial part in our daily activities. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the market seems to be baking in a prolonged downturn as the industry has shed 11.8% over the past six months. This drop was worse than the S&P 500's 2.2% fall. Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. With that said, here is one industrials stock boasting a durable advantage and two we're steering clear of. Market Cap: $8.78 billion Building Nimitz-class aircraft carriers used in active service, Huntington Ingalls (NYSE:HII) develops marine vessels and their mission systems and maintenance services. Why Do We Steer Clear of HII? Backlog growth averaged a weak 1.8% over the past two years, suggesting it may need to tweak its product roadmap or go-to-market strategy Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 9.2 percentage points Diminishing returns on capital suggest its earlier profit pools are drying up At $223.51 per share, Huntington Ingalls trades at 15.8x forward P/E. If you're considering HII for your portfolio, see our FREE research report to learn more. Market Cap: $40.64 billion Established to make automobiles accessible to a broader segment of the population, Ford (NYSE:F) designs, manufactures, and sells a variety of automobiles, trucks, and electric vehicles. Why Should You Sell F? Flat vehicles sold over the past two years imply it may need to invest in improvements to get back on track Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 13.4 percentage points 8× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings Ford is trading at $10.22 per share, or 7.5x forward P/E. To fully understand why you should be careful with F, check out our full research report (it's free). Market Cap: $698.9 million Spun off from FTAI Aviation in 2021, FTAI Infrastructure (NASDAQ:FIP) invests in and operates infrastructure and related assets across the transportation and energy sectors. Why Do We Like FIP? Annual revenue growth of 33.3% over the past three years was outstanding, reflecting market share gains this cycle Market share is on track to rise over the next 12 months as its 78.2% projected revenue growth implies demand will accelerate from its two-year trend FTAI Infrastructure's stock price of $6.08 implies a valuation ratio of 2.6x forward EV-to-EBITDA. Is now the time to initiate a position? Find out in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
