Carlisle (CSL) Gains From Solid Demand and Buyout Synergies

Carlisle Companies Incorporated (CSL Quick QuoteCSL - Free Report) manufactures and provides waterproofing and roofing products, finishing equipment, and engineered products. Its footprints are impressive in Africa, the United States, Asia, Europe, Canada, Latin America, Africa, and Mexico.

Solid growth opportunities and fundamentals have raised the company’s attractiveness. Presently, the Scottsdale, AZ-based company carries a Zacks Rank #2 (Buy). The company belongs to the Zacks Diversified Operations industry, which is in the top 28% (with a rank of 70) of more than 250 Zacks industries.

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What’s Making CSL an Attractive Investment Option?

In the first three quarters of 2021, Carlisle’s earnings beat estimates on all occasions. In the last reported quarter, its earnings were $2.99 per share, up 9.52% from the Zacks Consensus Estimate of $2.73. Then again, the bottom line in the quarter grew 54.1% year over year on the back of sales growth, partially hurt by high corporate expenses.

Notably, the Zacks Consensus Estimate for fourth-quarter 2021 (slated to report results on Feb 10, 2022) earnings of Carlisle is pegged at $2.63, suggesting an increase of 77.7% from the year-ago quarter’s reported figure.

Several factors are favoring the growth prospects of Carlisle. Products offered are diverse and demand is also healthy in the markets served. Also, the company benefits from acquired assets. It acquired California-based Henry Company last September. Other previous notable buyouts made by Carlisle include Providien, Petersen, Ecco Finishing and MicroConnex. Sound shareholder-friendly policies too add to the stock’s attractiveness. The acquisition of Henry Company is expected to add $1.25 per share to 2022 earnings.

For the Carlisle Construction Materials (“CCM”) segment, the strengthening business in the reroofing markets of the United States and Europe as well as growth in architectural metals and polyurethane platforms are proving advantageous.

Then again, focus on expanding the medical technologies platform, demand in the medical business, and improvements in the commercial aerospace business is favoring the Carlisle Interconnect Technologies (“CIT”) segment. The Carlisle Fluid Technologies (“CFT”) segment will gain from product introductions, focus on foam and powder, and sealants and adhesive platforms.

For 2021, Carlisle anticipates CCM’s revenues to grow in the mid-20 percentage range, while that of the CFT segment is to be in the mid-teens. Revenues of CIT, however, are likely to decline in the mid-single digits. Also, supply-chain restrictions, inflationary pressures, and raw materials are problematic.

The Zacks Consensus Estimate for Carlisle’s earnings per share is pegged at $9.21 for 2021 and $13.18 for 2022, suggesting year-over-year growth of 56.6% and 43.2%, respectively. The consensus estimate for 2021 reflects no change and that for 2022 mirrors an increase of 1% from the 60-day-ago figures.