Pall Corporation (PLL) saw quarter over quarter sales growth in its fiscal fourth quarter as it surprised on the Zacks Consensus Estimate by 9.62%. Even with the financial crisis, Pall raised its dividend in fiscal 2009.
Company Description
Pall designs solutions in filtration, separation and purification for customers across a wide range of industries including biopharmaceutical, hospital and transfusion medicine, energy and alternative energy, electronics, municipal and industrial water, aerospace, and transportation.
The company’s Total Fluid Management solutions enable customers to minimize emissions and waste.
Pall Saw Economic Conditions Improving
On Sep 14, the company reported fiscal fourth quarter 2009 earnings and full-year 2009 earnings. Revenues in the fourth quarter were still off 2008 levels but some segments saw improvement.
Life Sciences’ sales rose 5.2%, Medical sales grew 1.6%, and Biopharmaceuticals climbed 7.8%. But the Industrial Segment struggled, declining 8.8% year over year which reflects the state of the manufacturing sector.
On the positive side, it was the first quarter in a year that the Microelectronics sector showed sales growth quarter over quarter, even as sales were still down by 31.7% compared to the fourth quarter of 2008.
Fiscal 2010 Outlook
The company forecasts global economic activity to remain weak for the last two quarters of 2009 before a slow recovery in the first half of 2010. Pall will continue to reduce its costs.
Growth
Analysts see brighter days ahead for the company. The fiscal first quarter Zacks Consensus Estimate rose 3 cents to 42 cents in the last 30 days as 2 out of 7 covering analysts raised during that time.
For fiscal 2010, estimates jumped 7 cents to $1.94 with 7 out of 8 analysts raising in the last month.
5-year earnings growth is expected to be 14.67%. Analysts forecast year over year earnings growth in fiscal 2010 of 8.92%.
Income
Paying dividends is nearly unheard of in this industry so Pall easily outpaces its peers in the income category. It is currently paying a dividend with a yield of 1.78%.
Fundamentals
Pall Corporation is a Zacks #2 Rank (buy) stock. It is trading with a forward P/E of 16.84. The company has a strong return on equity of 20.12%, well above the industry average of 2.88%.
