Yahoo Finance Snap-on's (SNA) Growth Strategies Seem Good: Apt to Hold?
Snap-on Incorporated SNA appears well-poised for growth, thanks to its solid business strategies. The company is focused on growth strategies, including enhancing the franchise network, improving relationships with repair shop owners and managers, and expanding into critical industries in emerging markets.
Analysts seem optimistic about the company. The Zacks Consensus Estimate for 2024 sales and earnings per share (EPS) is pegged at $4.85 billion and $19.21, respectively, indicating year-over-year growth of 2.4% each.
Let’s Delve Deeper
Snap-on's emphasis on its Rapid Continuous Improvement (RCI) process is aimed at enhancing organizational effectiveness, reducing costs, and boosting sales and margins. Savings from the RCI initiative come from continuous productivity and process-improvement plans. The company’s robust business model helps enhance value-creation processes, which in turn improves safety, quality of service, customer satisfaction and innovation.
The company is dedicated to various strategic principles and processes aimed at creating value in areas like RCI. Management intends to boost customer services, along with enhancing manufacturing and supply-chain capabilities, through the RCI initiatives and further investments. This apart, Snap-on’s ability to innovate bodes well. It has been investing in new products and increasing brand awareness across the world as well.
Snap-On Incorporated Price, Consensus and EPS Surprise
Snap-On Incorporated price-consensus-eps-surprise-chart | Snap-On Incorporated Quote
Snap-on’s business trends remain robust as evident from the strong performance across its few operating segments. In the first quarter, sales in Repair Systems & Information Group advanced 3.9% year over year, with organic sales growth of 3.3%. Sales also gained from a $2.5-million positive impact of currency. Higher activity with OEM dealerships and a rise in sales of under-car equipment contributed to the segment’s organic sales growth. Further, the Financial Services business’ revenues rose 7.6% year over year to $99.6 million.
However, Snap-on has been witnessing ongoing challenges due to macroeconomic headwinds. It has been grappling with the impacts of rising cost inflation, primarily driven by increased raw material expenses and other related costs. Nevertheless, management believes that the company’s markets and operations have considerable resilience against the uncertainties of the environment. In 2024, Snap-on anticipates progress along its defined runways for growth.
Nevertheless, management expects continued progress by leveraging capabilities in the automotive repair arena, as well as expanding its customer base in automotive repair and across geographies, including critical industries.
Buoyed by such catalysts, shares of this Zacks Rank #3 (Hold) company have gained 5.4% against the industry’s 0.7% decline in the past year.
Stocks to Consider
Some better-ranked companies are GIII Apparel GIII, Royal Caribbean RCL and lululemon athletica LULU.
GIII Apparel, an accessories dealer, sports a Zacks Rank #1 (Strong Buy) at present. GIII has a trailing four-quarter earnings surprise of 571.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for GIII Apparel’s current financial-year sales indicates growth of 3.4% from the year-ago reported figure.
Royal Caribbean currently flaunts a Zacks Rank of 1. RCL has a trailing four-quarter earnings surprise of 18.3%, on average.
The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates increases of 16.8% and 63.8%, respectively, from the year-ago reported levels.
lululemon athletica is a yoga-inspired athletic apparel company. LULU carries a Zacks Rank #2 (Buy) at present.
The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS indicates growth of 11.5% and 11.7%, respectively, from the year-ago reported figures. LULU has a trailing four-quarter earnings surprise of 7.4%, on average.
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Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Snap-On Incorporated (SNA) : Free Stock Analysis Report
lululemon athletica inc. (LULU) : Free Stock Analysis Report
G-III Apparel Group, LTD. (GIII) : Free Stock Analysis Report
