Kronos Worldwide, Inc. - Momentum

Kronos Worldwide, Inc. (KRO) is looking like a momentum high flyer, recently jumping to a new multi-year high on another strong quarter of earnings. With estimates on the rise and a bullish growth projection, this Zacks #1 rank stock is trading strong.

Company Description

Kronos Worldwide, Inc. engages in the production and marketing of titanium dioxide pigments, AKA specialty chemicals, in North America and Europe. The company was founded in 1989 and has market cap of $3.38 billion.

Although KRO has been strong for the last six months, shares got an extra boost on March 7 when the company reported another strong quarter that came in ahead of expectations.

Fourth-Quarter Results

Revenue for the period was up 16% from last year to $263 million. Earnings also looked good, coming in at 66 cents, 6.5% ahead of the Zacks Consensus Estimate, where the company has an average earnings surprise of 71% over the last four quarters.

The company noted that its good quarter and strong year were driven by a combination of higher prices and increased volume on strong demand out of Europe

Financial Profile

Kronos has used its recent earnings momentum to strengthen its balance sheet, with cash and equivalents up $274 million from last year to $307 million while total debt fell $73 million to $540 million.

Estimates

We saw some pretty solid movement in estimates off the good quarter, with the current year up 93 cents to $4.37 while the next-year estimate added $1.24, climbing to $5.76, a 32% growth projection.

Valuation

But in spite of the gains, the valuation picture still looks good, with a forward P/E of 13X a discount to its peer average of 14X.

12-Month Chart

On the chart, KRO continues to pressure its recent all-time high at $59.80 on the good quarter and compelling valuation. Look for support from the long-term trend on any weakness. Take a look below.