Pall Corporation - Growth & Income

Pall Corporation (PLL) saw its industrial segment return to profitability last quarter as the global recovery took hold. Will it still see the growth when it reports its fiscal fourth quarter on Sep 14?

Pall designs solutions in filtration, separation and purification for customers across a wide range of industries including biopharmaceutical, hospital and transfusion medicine, energy and alternative energy, electronics, municipal and industrial water, aerospace, and transportation.

The company's Total Fluid Management solutions enable customers to minimize emissions and waste.

Sales Jumped 10.8% in the Fiscal Third Quarter

On June 8, Pall Corporation reported fiscal third quarter 2010 results which saw sales climb by 10.8% to $616 million.

The company surprised on the Zacks consensus by 16%. Earnings per share were 58 cents compared to the consensus of 50 cents. It made 42 cents in the year ago period.

Pall's Industrial segment returned to growth in the quarter as sales rose 5%. All of the Industrial submarkets, with the exception of Aerospace, saw double digit growth in orders as the global recovery firmly took hold.

Growth was especially strong in the Microelectronics submarket where sales soared 77% to 18 month highs.

That was a result of higher capacity utilization at chip producers as well as growth in demand for consumer electronic products. Pall also has high margins in this submarket.

Guidance Expected at the High End of the Range

Pall did not raise guidance in June but it did guide to the high end of its March guidance range of $1.95 to $2.05 per share.

Not surprisingly, the Zacks Consensus is calling for $2.04 per share, up from $1.98 in the last 90 days. This is solid earnings growth of 14.7% compared to fiscal 2009.

2011 is looking bullish already as analysts expect continued double digit earnings growth of 12.5%.

Analysts forecast steady earnings growth of 10% a year over the next 5 years.

Income Higher Than the Industry

Pall's industry is not known for its dividend payouts, as the average is 0%. Pall, therefore, is an outlier in the industry as its dividend payout is currently 1.9%.

Pall is Zacks #2 Rank (buy) stock.

Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor in charge of the market-beating Zacks Value Trader service. You can follow her at twitter.com/traceyryniec.

 
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