Buy the Dip: 2 Upgraded Stocks in the Industrials Sector

NYSE: RHI | Robert Half International Inc. News, Ratings, and Charts

RHI – The industrials sector has gained attention lately, primarily due to President Biden’s infrastructure bill. So, it could be wise to scoop up the shares of quality industrials stocks Robert Half International (RHI) and Franklin Electric (FELE) that have declined lately but hold solid upside potential.

The recession worries and the inflationary environment have been concerns for investors looking to benefit from the economic recovery. However, The U.S. economy added slightly more jobs than expected in April, as the Nonfarm payrolls grew by 428,000, a bit above the Dow Jones estimate of 400,000.

According to a Federal Reserve report, the total industrial production rose at an 8.1% annual rate for the first quarter. Moreover, President Joe Biden’s $1 trillion bipartisan infrastructure bill, which includes $550 billion in new spending for building roads, rails, and bridges, is expected to help the sector grow significantly in the upcoming months.

Given this backdrop, it could be wise to bet on fundamentally sound industrials stocks Robert Half International Inc. (RHI) and Franklin Electric Co., Inc. (FELE), which have declined lately but hold substantial upside potential.

Click here to check out our Industrial Sector Report for 2022

Robert Half International Inc. (RHI)

RHI provides staffing and risk consulting services in North America, South America, Europe, Asia, and Australia. The company operates through temporary and Consultant Staffing; permanent placement staffing; risk consulting; and internal audit services. B of A Securities upgraded the stock from Neutral to Buy.

On May 3, 2022, RHI announced that its board of directors had approved a quarterly cash dividend of $0.43 per share. The cash dividend will be paid on June 15, 2022, to all shareholders of record as of May 25, 2022.

RHI’s net sales increased 29.8% year-over-year to $1.81 billion in the first quarter, which ended March 31, 2022. The company’s net income came in at $168.24 million, representing a 52.1% year-over-year increase. Also, its EPS came in at $1.52, up 55.1% year-over-year.

Analysts expect RHI’s EPS and revenue to increase 19.5% and 28.7% year-over-year to $1.59 and $1.90 billion, respectively, for the quarter ending June 30, 2022. In addition, it surpassed the consensus EPS estimates in each of the trailing four quarters. The stock has gained 10.7% over the past year to close yesterday’s trading session at $98.74.

RHI’s POWR Ratings reflect this promising outlook. The company has an overall rating of B, which translates to Buy in our proprietary ratings system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

The stock has an A grade for Quality and a B grade for Value. RHI is ranked #7 of 18 stocks within the A-rated Outsourcing – Staffing Services industry. Click here to see RHI’s rating for Stability, Growth, Momentum, and Sentiment as well.

Franklin Electric Co., Inc. (FELE)

FELE designs, manufactures, and distributes water and fuel pumping systems worldwide. It operates through three segments: Water Systems, Fueling Systems, and Distribution. The company sells its products to wholesale and retail distributors, specialty distributors, original equipment manufacturers, industrial and petroleum equipment distributors, and oil and utility companies. Seaport Global upgraded the previous rating of Neutral to Buy.

On April 25, 2022, FELE announced that its Board of Directors declared a quarterly cash dividend of $0.20 per share payable May 19, 2022, to shareholders of record on May 5, 2022.

FELE’s net sales increased 36% year-over-year to $451.50 million in the first quarter, which ended March 31, 2022. The company’s operating income grew 18% year-over-year to $39.90 million, while its net income came in at $30.12 million, representing a 6.9% year-over-year increase. Also, its EPS came in at $0.63, up 6.8% year-over-year.

For the quarter ending June 30, 2022, analysts expect FELE’s EPS to come in at $1.05, representing a 26.5% year-over-year increase. It surpassed the consensus EPS estimates in each of the trailing four quarters. In addition, its revenue is expected to increase 21.3% year-over-year to $2.02 billion in fiscal 2022.

FELE’s strong fundamentals are reflected in its POWR Ratings. We have graded FELE for Growth, Momentum, Stability, Sentiment, Quality, and Value. Click here to access all of FELE’s ratings. FELE is ranked #14 out of 37 stocks in the A-rated Industrial – Manufacturing industry.

RHI shares were unchanged in after-hours trading Friday. Year-to-date, RHI has declined -12.64%, versus a -13.13% rise in the benchmark S&P 500 index during the same period.

About the Author: Nimesh Jaiswal

Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles. More...

More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
RHIGet RatingGet RatingGet Rating
FELEGet RatingGet RatingGet Rating

Most Popular Stories on

Is This REALLY a Bull Market?

The S&P 500 (SPY) keeps making record highs...but does that mean that market conditions are truly bullish? 44 year investment veteran shines a light on how hollow recent gains are as they are only accruing to a handful of stocks with most investors searching high and low for stock market gains. Read on for more...

Unveiling Adobe (ADBE) Q2 Earnings: What Lies Ahead for Investors?

Software giant Adobe Inc. (ADBE) has released its second-quarter earnings, revealing double-digit growth in both revenue and profits. Yet, concerns arise around the complexities of navigating growth in the face of advancing AI technologies. Let’s analyze ADBE’s recent performance and assess key fundamentals to uncover what lies ahead for investors…

3 AI Stocks to Invest in for the Next Technological Revolution

The AI market is experiencing a significant growth trajectory, driven by widespread application across various industries. Hence, it could be wise to invest in top AI stocks, Alphabet (GOOGL), Meta Platforms (META), and Alibaba Group Holding (BABA) for the next technological revolution. Read more...

Analyzing Broadcom’s (AVGO) Q2 Earnings: Worth Investing?

Driven by a surge in demand for its AI products, Broadcom (AVGO) reported robust earnings in its latest quarterly results, exceeding expectations on both top and bottom lines. However, is the stock’s recent announcement of a 10-for-1 stock split worth investing in? Keep reading to find out…

Bullish or Bearish Stock Set Up?

The S&P 500 (SPY) record highs sounds pretty darn bullish on the surface. Yet as we dig below the surface there are some curious signals that point more Risk Off. This is especially true as we come into the next Fed meeting after a round of data that points to inflation still being too high...only further delaying the first rate cut. What does this all mean for stocks from here? Steve Reitmeister offers his latest views on the market outlook along with a preview of his top picks to stay on step ahead of the market. Read on for more...

Read More Stories

More Robert Half International Inc. (RHI) News View All

Event/Date Symbol News Detail Start Price End Price Change POWR Rating
Loading, please wait...
View All RHI News