Timken is in the buy zone above a buy point of 76.43 in a flat base. This growth stock ranks fifth in the Metal Processing and Fabrication group, which stands 43rd among IBD's 197 industry groups. Other stocks in the group include RBC Bearings, Haynes International and Commercial Metals.
Timken has joined the IBD 50, an elite list of growth stocks with strong fundamental and technical ratings, as well as stellar price performance. The stock broke out in strong volume earlier this month and pulled back, bouncing back into the buy zone this week.
Strong Ratings for Growth Stock
TKR stock holds a 96 Composite Rating and 90 Relative Strength Rating. Sales grew 10% year-over-year in the most recent quarter to $1.13 billion. Earnings have grown in double digits over the past three quarters, giving the stock a strong 91 EPS Rating.
Third quarter earnings of $1.52 per share marked 29% year-over-year growth. The North Canton, Ohio, based company will announce fourth-quarter and full-year earnings on Feb 6.
The company currently pays an annualized 1.61% dividend yield. The growth stock boasts an unbroken dividend record for 402 consecutive quarters and is on track for 9 consecutive years of dividend growth.
Timken raised its full year outlook in October to between $5.80-$5.90 a share and expects revenue to rise 9% from the 2021 midpoint.
Brands and Product Portfolio
Timken makes engineered bearings, cylindrical bearings and housed units for friction management. These are used throughout vehicles, including in brakes, clutches, chains, gears and other equipment. Brands include Philadelphia Gear, PT Tech, Timken, Rollon and others. The company also has offices in France, China and India.
In November, the company acquired GGB Bearings from EnPro Industries. The new division makes customized plain bearings and metal polymer bearings. In the same month, it sold its aerospace drive system to PCX Aerostructures.
In January, Ford started using Timken's packaged wheel bearings for its F-150 Lightning — its light duty electric pick up truck. The manufacturer also uses Timken's bearings for its Expedition and Lincoln Navigator.
Mutual funds own 59% of outstanding shares and more funds have been buying over the past four quarters. Not surprisingly, the growth stock has a top notch Accumulation/Distribution Rating of "A".
Strong interest from institutional investors is seen as a sign of strength, according to the CAN SLIM stock picking strategy.
Amongst exchange traded funds, the iShares Core S&P 500 Midcap ETF and Fidelity MSCI Industrials Index ETF also hold shares.
Please follow VRamakrishnan @IBD_VRamakrishnan for more news on growth stocks.
