|Written by GSCR Staff|
|Wednesday, 09 October 2013 07:23|
In Monday’s Goldman Guide number 10 on our list of ways to invest for 4Q 2013 was to put money in a stock that had a catalytic event or inflection point. Quarterly financial reporting season has begun and for some stocks these numbers represent a turnaround or the continuation of some awesome momentum.
This morning Zep, Inc. (NYSE – ZEP - $15.70) released fiscal 4Q13 and annual 2013 financial results. 4Q13 revenue was just over $182 million versus the $179 estimate, and earnings were $0.28 per share versus $0.24 estimate. Net sales for the entire fiscal year of 2013 were $689.6 million versus $686.5 estimate. These numbers along with a positive outlook for the Company’s 2014 fiscal year should prove to be the catalyst to drive the share price higher.
Zep is a producer and marketer of cleaning and maintenance chemicals, and related products and services for commercial, industrial, institutional, and consumer applications in North America and Europe. Its product portfolio includes anti-bacterial and industrial hand care products, cleaners, degreasers, deodorizers, disinfectants, floor finishes, sanitizers, pest- and weed-control products, air-care products and delivery systems, and various automotive maintenance chemicals for the automotive, fleet maintenance, industrial/maintenance and repair supply, institutional supply, and motorcycle markets. The Company markets its products and services under various brands, such as Zep, Selig, Armor-All, Niagara, Washtronics, Enforcer, Forward, Rexodan, Zep Commercial, Mykal, De.Solv.It, Original Bike Spirits, Country Vet, Zep Professional, Microbemax, Misty, TimeMist, i-Chem, TimeWick, and Next Dimension brand names, as well as private label and OEM private brand names.
Additionally, our three-fold checklist given the current market conditions makes ZEP a very attractive prospect. Very bullish signals for long, intermediate, and short term DMA make the stock look great from a technical analysis perspective. Plus, FY2014 earnings are forecast to increase 16% putting next year’s FY P/E just over 16. Check number two. Finally, ZEP is on a great momentum run, up nearly 19% over the last three months trading at nearly 100,000 shares per session.
Separately, last week Zep announced it was increasing its quarterly dividend by 25% to $0.05 per share with an ex-dividend date of October 17th. This is yet another positive for owning the stock. Look for a nice bump over the next several weeks.
Have a great day!
Disclosure: Goldman Small Cap Research analysts are neither long nor short these shares but may elect to purchase the stock within the next 48 hours.
This Market Monitor blog was prepared for informational purposes only. Goldman Small Cap Research, (a division of Two Triangle Consulting Group, LLC) produces research via two formats: Goldman Select Research, which typically highlights small cap companies, and Goldman Opportunity Research, which features micro cap companies in a sponsored research format. Thus, the Select product reflects the Firm’s internally generated stock ideas while the Opportunity product reflects sponsored research reports.
Goldman Small Cap Research is not affiliated in any way with Goldman Sachs & Co.
It is important to note that while we may track performance separately, we utilize the same coverage criteria in determining coverage of all stocks in both research formats. Please view the company’s individual disclosures for each engagement, which can be found in each company-specific report. All information contained in this blog, newsletter and in our reports were provided by the Companies or generated from our own due diligence. Our analysts are responsible only to the public, and are paid in advance to eliminate pecuniary interests, retain editorial control, and ensure independence. Analysts are compensated on a per report basis and not on the basis of his/her recommendations.
The information used and statements of fact made have been obtained from sources considered reliable but we neither guarantee nor represent the completeness or accuracy. Goldman Small Cap Research did not make an independent investigation or inquiry as to the accuracy of any information provided by the Company, or other firms. Goldman Small Cap Research relied solely upon information provided by the Company through its filings, press releases, presentations, and through its own internal due diligence for accuracy and completeness. Such information and the opinions expressed are subject to change without notice. A Goldman Small Cap Research blog, report, note, or newsletter is not intended as an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed.
This blog does not take into account the investment objectives, financial situation, or particular needs of any particular person. This blog does not provide all information material to an investor’s decision about whether or not to make any investment. Any discussion of risks in this presentation is not a disclosure of all risks or a complete discussion of the risks mentioned. Neither Goldman Small Cap Research, nor its parent, is registered as a securities broker-dealer or an investment adviser with FINRA or with any state securities regulatory authority.
ALL INFORMATION IN THIS BLOG, REPORT OR NEWSLETTER IS PROVIDED “AS IS” WITHOUT WARRANTIES, EXPRESSED OR IMPLIED, OR REPRESENTATIONS OF ANY KIND. TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE FOR THE QUALITY, ACCURACY, COMPLETENESS, RELIABILITY OR TIMELINESS OF THIS INFORMATION, OR FOR ANY DIRECT, INDIRECT, CONSEQUENTIAL, INCIDENTAL, SPECIAL OR PUNITIVE DAMAGES THAT MAY ARISE OUT OF THE USE OF THIS INFORMATION BY YOU OR ANYONE ELSE (INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOSS OF OPPORTUNITIES, TRADING LOSSES, AND DAMAGES THAT MAY RESULT FROM ANY INACCURACY OR INCOMPLETENESS OF THIS INFORMATION). TO THE FULLEST EXTENT PERMITTED BY LAW, TWO TRIANGLE CONSULTING GROUP, LLC WILL NOT BE LIABLE TO YOU OR ANYONE ELSE UNDER ANY TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY, OR OTHER THEORY WITH RESPECT TO THIS PRESENTATION OF INFORMATION.
For more information, visit our Disclaimer: www.goldmanresearch.com