Valued at a market cap of $24.5 billion, Hubbell Incorporated (HUBB) designs, manufactures and sells electrical and utility solutions to commercial, industrial, utility, and telecommunications markets. The Shelton, Connecticut-based company’s products include plugs, receptacles, connectors, lighting fixtures, high voltage test and measurement equipment, and voice and data signal processing components.
Companies worth $10 billion or more are generally described as “large-cap” stocks, and HUBB fits right into that category, with its market cap exceeding this threshold. The company is a leading manufacturer of utility and electrical solutions, which enables its customers to operate critical infrastructure safely, reliably, and efficiently.
The electrical equipment company has declined 9% from its 52-week high of $481.35, achieved on Nov. 6. Nevertheless, it has gained 6.9% over the past three months, outperforming the broader Industrial Select Sector SPDR Fund’s (XLI) 3.3% increase over the same time frame.
Moreover, in the longer term, HUBB has rallied 35.1% over the past 52 weeks, outperforming XLI’s 20.6% returns. On a YTD basis, shares of HUBB are up 33.6%, surpassing XLI’s 19.6% gains over the same time frame.
To confirm its bullish trend, HUBB has been trading above its 200-day moving average for the past year. However, it has been trading below its 50-day moving average since mid-December.
On Oct. 29, shares of HUBB plunged 2.1% following its mixed Q3 earnings release. The company’s revenue of $1.44 billion increased 4.9% from a year ago but missed the consensus estimates by 2.7%. Meanwhile, its adjusted earnings increased 13.7% year-over-year to $4.49, which marginally exceeded the forecasted figure of $4.47.
Weaker telecom and utility distribution markets primarily contributed to the company’s revenue miss. Additionally, its organic sales declined by approximately 1%, and sales growth was completely driven by mergers and acquisitions. Nonetheless, solid operating margin expansion and double-digit growth in operating income aided the company’s bottom line and led to its earnings beat.
HUBB has underperformed its rival, Eaton Corporation plc (ETN), which gained 46.2% over the past 52 weeks and 44.1% on a YTD basis.
Given HUBB’s recent outperformance relative to its broader sector, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 11 analysts covering it, and the mean price target of $479.11 suggests a modest 9% premium to its current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from Barchart- Wedbush Just Doubled Its Price Target on This Hot AI Stock. Is It Time to Buy?
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