Carpenter Technology is the IBD Stock Of The Day for Monday. CRS stock is approaching a buy point near record highs while specialty alloy producers rally.
Philadelphia-based Carpenter Technology manufactures and distributes specialty metals including titanium, steel, cobalt, nickel, chromium and iron scrap. The company supplies alloys for various uses across the aerospace, defense, transportation, energy and medical industries. Carpenter's metals are used for engines, fuel systems, landing gear, drills, valves, prosthetics, medical devices and an array of other applications.
The company is on an impressive earnings streak, recording triple-digit gains the last six quarters. However, earnings growth slowed to a 213% increase for its Q3 results in May. Carpenter's Q4 adjusted earnings from July 2023 improved to 78 cents per share from earnings of 0 cents the year prior. Meanwhile, revenue growth has slowed over the last five quarters, to a 1% decline in Q3 from a 46% jump in the second quarter of 2022.
For Carpenter's upcoming Q4 results, FactSet analysts expect earnings to increase nearly 93% to $1.50 per share adjusted on a slight uptick in sales to a quarterly record $764 million. Carpenter has not yet announced a reporting date.
Meanwhile, gold and copper mining stocks are showing improvement with Southern Copper and Agnico Eagle Mines both trading near buy points.
However, steel producers, including Steel Dynamics, Nucor and Cleveland-Cliffs have struggled this year after triggering sell signals in late April following Q1 results. Steel Dynamics pared gains to 4.9% for this year while Nucor retreated 12.4%. Cleveland-Cliffs has unraveled nearly 24% in 2024.
Carpenter Technology leads the Steel-Specialty Alloys Group according to the IBD Stock Checkup. The Steel-Specialty Alloys Group ranks 10th out of the 197 industry groups tracked by IBD and has advanced 25.7% so far this year. Industry rival ATI has a year-to-date gain of 27.2%.
The Steel-Producers industry group hasn't performed nearly as well this year and is down 8.8% in 2024 through Monday. The Steel-Producers group ranks 187th out of the 197 industries tracked by IBD.
Carpenter Technology Stock
CRS stock is approaching a 110.18 buy point in a developing cup-with-handle base. The base will be seven weeks long, giving it a valid buy point, after this week.
Aggressive investors could plot an early trendline entry from the top of the base, with the record high of 112.75 from May 28 as the peak. Still, that puts the trendline entry right around the cup-with-handle buy point.
The stock showed nice volume during a rebound from its 50-day moving average from late June. However, that surge in volume has diminished.
CRS stock rallied more than 51% so far this year.
Carpenter Technology has a perfect 99 Composite Rating. The Composite Rating combines various technical indicators into one easy-to-read score. The company has an 82 EPS Rating. CRS stock's relative strength line is shy of its 52-week highs from May. Shares have a 97 RS Rating.
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