Heating and air conditioning giant Carrier Global is a tale of two metrics. Its earnings growth has accelerated three quarters in a row. But its sales growth dwindled during that time. The Street seems to think that sales growth will fall in line, and the Relative Strength (RS) Rating for Carrier stock climbed from 68 to 71 Wednesday.
Carrier's earnings per share fell 6% in the March, 2023-ended quarter, then over the next three quarters improved to 13% growth, 27% and 33% last quarter, to 53 cents per share.
Carrier Stock About 5 Points Below All-Time High
Meanwhile its revenue grew 13% in the March 2023 quarter, rose to 15% the next quarter then slid to 5% and it was flat last quarter at $5.1 billion.
Despite that discrepancy between profits and sales, the watchlist candidate still trades within shouting distance of its all-time intraday high 60.04, set on Aug. 1. On Wednesday Carrier closed at 54.76, down fractionally for the day. Carrier stock is trying to complete a consolidation with the 60.04 buy point. See if it can clear the breakout price in volume at least 40% higher than normal.
The upgraded 71 RS Rating shows that Carrier stock tops more than 70% of all stocks for price performance over the last 52 weeks.
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Earnings Are Its Strong Suit
Among its other key ratings, Palm Beach Gardens, Fla.-based Carrier — not surprisingly — has a strong 84 Earnings Per Share Rating out of 99. Carrier stock's Composite Rating, a gauge of overall technical and fundamental prowess, is a decent 82.
One outstanding rating is its A SMR Rating (sales + profit margins + return on equity) on an A-to-E scale with A superb and E lousy. One yellow flag is its D- Accumulation/Distribution Rating, indicating that ETFs, insurance funds and other institutional investors are selling more shares than buying. Look for that to improve to a C or better rating.
Carrier Global earns the No. 9 rank among its peers in the Building-A/C & Heating Products industry group. Comfort Systems USA and Modine Manufacturing are among the group's highest-rated stocks.
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