Fastenal Company (FAST) | Daily Alert August 20
We like Fastenal Co. (Rated “B”) for three specific reasons:
- Fastenal is one of the nation’s largest suppliers and distributors of a wide range of construction and manufacturing products. Pumps, fasteners, plugs, tape, motors, drills, gloves, hydraulic hoses, fans, ice makers, locks, and two-way radios.
- Fastenal delivered a 10% rise in revenue and a 17% increase in earnings. Profit margins are increasing sequentially this year as well, while construction activity is ramping up nicely. Increased infrastructure spending in 2021 and 2022 will only help future results.
- Fastenal’s yield beats the yield on the S&P 500 by 60 basis points. FAST is also breaking out to the upside again on the charts.
Buy a 2.5% position in Fastenal Co. at the market.
Mike Larson, Safe Money Report, 1-877-934-7778, weissratings.com, August 2021
Dover Corporation (DOV) | Daily Alert August 25
Each of Dover’s five business segments posted organic revenue growth relative to pre-pandemic second-quarter 2019.
The upward arrows don’t stop with organic sales growth. Backlog in the second quarter rose 16% sequentially, 69% year-over-year, and 82% versus 2019’s second quarter.
Other positive signs include fresh revenue and earnings guidance for 2021, as well as Dover’s dividend (recently increased for the 66th consecutive year). Finally, the most important upward arrow—the stock price—has been trending higher, with these shares recently moving to an all-time high. Dover is rated Buy and Long-Term Buy.
Strong revenue growth in the quarter fueled a nice jump in per share profits, which grew 82% and beat the analysts’ consensus estimate of $1.84. In the wake of a boost in full-year guidance, Dover expects revenue growth of 15% to 17% and per-share-profit growth of 29% to 31% in 2021.
Trading at 23 times the 2021 profit consensus, Dover is neither cheap nor excessively valued. The stock offers a nice combo of capital-gains potential and a rising income stream.
Richard Moroney, CFA, Dow Theory Forecasts, dowtheory.com, 800-233-5922, August 16, 2021
Expeditors International of Washington, Inc. (EXPD) | Daily Alert August 26
Right now, the Weiss Ratings system has marked 1,125 stocks as a solid “Buy.”
One such company is Expeditors International of Washington. This giant logistics company is based in Seattle but has a global network of 176 offices in over 60 countries spread over six continents.
The company is service-based, so it doesn’t own the aircraft, ships, or trucks it uses every day. This also allows EXPD to be incredibly flexible to find the best route for the best price.
EXPD has only dropped into the “Hold” range twice since 2014. The company pays a small dividend, and shares are up 25% since the beginning of the year.
Kelly Green, Weiss Ratings, Weiss Ratings, 1-877-934-7778, weissratings.com, August 19, 2021
Spectrum Brands Holdings, Inc. (SPB)| Daily Alert September 1
Spectrum Brands Holdings, Inc. is a home essentials retailer that has been slightly lower since being added to the portfolio earlier this month as the delta variant has hurt consumer confidence. But this is no ordinary retailer. Demand for home products is stronger with bad virus news. Plus, demand for home products is likely to remain strong after the pandemic stuff is long over. It’s still a good entry point for the stock if you don’t own it already. BUY.
Tom Hutchinson, Cabot Dividend Investor, cabotwealth.com, 978-745-5532, August 25, 2021
*Waste Management, Inc. (WM)
WM is the leading waste management company in North America, providing collection, transfer, recycling and resource recovery, and disposal services to residential, commercial, industrial and municipal customers. It is also a leading developer, operator and owner of landfill gas-to-energy facilities in the U.S., and it has the largest network of recycling facilities, transfer stations and landfills (even receiving revenue in certain regions from competitors that use its landfills), while it has been making acquisitions to diversify its geographic footprint.
WM recently turned in another solid quarter, earning $1.27 per share in Q2 on revenue of $4.48 billion, both ahead of analyst estimates. Although the stock has risen handsomely since our initial recommendation in March 2020, we continue to think WM offers additional lower-risk capital appreciation potential with a decent, growing dividend.
John Buckingham, The Prudent Speculator, theprudentspeculator.com, 877-817-4394, August 3, 2021
Waste Management is a great performer for us. Our cost basis is $27.66 with the purchase date in September of 2005. Of the 18 analysts who follow the stock, 9 recommend “Strong Buy” or “Buy,” 7 say “Hold,” and 2 recommend “Sell.” One analyst has a bull target of $228, which we agree with.
WM’s size and scale gives it a unique advantage as its asset network gives it a wide moat relative to other players within the industry. Efficiencies achieved during the pandemic will have a significant impact as we see it.
WM is the biggest residential recycler in North America and the largest operator of landfills in the country. We are quite impressed with at the management skills of Jim Fish, CEO; he is a 58-year-old dynamo and has been quite instrumental in WM’s growth.
Sean Christian, The Personal Capitalist, 9524 East 81st Street, Suite B #1715, Tulsa, OK 74133, August 17, 2021
*Element Solutions Inc (ESI)
Element Solutions Inc. produces and sells specialty chemical products for the electronics industry and for other industrial applications such as the control fluids for offshore deep-water oil production and drilling applications.
Wealth Advisory Earnings Grade: A+
We added Element Solutions as a play on both the continued growth of the consumer electronics market and the resurgence of the offshore oil industry. With fewer new oil discoveries coming, offshore wells will become efficient again and ESI will supply the chemicals to keep them running.
And as electronics become more affordable and more accessible, ESI will sell more products for their treatment and production. There’s a long future ahead of this company, and we’re happy to add shares below the new limit price.
Element Solutions Inc. stock is now a “Buy” anywhere under $30. The 12-month price target is $45.
Jason Williams, The Wealth Advisory, angelpub.com, 877-303-4529, August 21, 2021