Highlighted stocks include RockTenn Company (RKT), Sturm, Ruger & Company, Inc. (RGR), Air Methods Corporation (AIRM), Dr. Pepper Snapple Group Inc. (DPS) and Big Lots, Inc. (BIG).
RockTenn Company (RKT), the packaging products manufacturer, reported record earnings for the fiscal second quarter of 2009 which surprised on estimates by 3.03%.
On Apr 27, RockTenn reported record adjusted earnings per share that rose 55% to $1.02 compared to 66 cents in the year ago quarter.
Sales fell $9.6 million to $673.3 million from the year ago period due to reduced volumes and decreased recycled fiber pricing. However, sales increased in the Corrugated Packaging segment due to the acquisition of Southern Container.
Lower commodity costs, for both recycled fiber and energy, also helped the company’s performance.
Consensus estimates for the fiscal third quarter have been holding steady over the last 60 days at 86 cents per share. Full-year estimates are up 3.4% to $3.64 from $3.52 per share in the prior 2 months.
Value Fundamentals
When we last reviewed RockTenn on Mar 25, it was a Zacks #1 Rank (strong buy) stock. It has since moved to a Zacks #2 Rank (buy) stock. It is still an attractive value stock with a forward P/E of 11.4 and a price-to-book ratio of 2.36.
The company has a 1-year return on equity (ROE) of 20.77%. As an added bonus, it also pays a dividend with a current yield of 1.00%.
Update to Previous Value Zacks Rank Buy Stocks
Sturm, Ruger & Company, Inc. (RGR), the revolver manufacturer, saw firearms sales jump 55.5% in the first quarter as demand remains strong. The company has surprised on estimates the last 2 quarters. RGR trades with a forward P/E of 12.59 despite the stock nearly doubling since Feb 20. Read the full article.
Air Methods Corporation (AIRM), which provides emergency air transportation, saw revenue grow 5.6% in the first quarter as fuel costs declined sharply. The company has surprised on estimates 2 out of the last 4 quarters. It has a PEG ratio of just 0.69. Read the full article.
Dr. Pepper Snapple Group Inc. (DPS) is seeing growth in its value juice drinks and its flagship Dr. Pepper brand. The company has surprised on estimates 3 out of the last 4 quarters by an average of 4.91%. Read the full article.
Big Lots, Inc. (BIG), the closeout retailer, recently surprised on estimates for the third time in the last 4 quarters. BIG trades with a forward P/E of 12.3. Read the full article.
