Hubbell Incorporated Sees Impressive Gains Despite Mixed Q3 Results
Shelton, Connecticut’s Hubbell Incorporated (HUBB) specializes in designing, manufacturing, and selling electrical and electronic products across various industries, including commercial, industrial, utility, and telecommunications markets. With a market capitalization of $24.7 billion, Hubbell operates through two main segments: Electrical Solutions and Utility Solutions.
Strong Performance Against Industry Benchmarks
Over the past year, Hubbell has significantly outperformed the broader market. HUBB stock has surged by 40.1% year-to-date and 53.7% over the past 52 weeks, outpacing the S&P 500 Index’s gains of 25.2% in 2024 and 31% over the last year.
Focusing on sector performance, HUBB has also outshined the Industrial Select Sector SPDR Fund (XLI), which recorded gains of 25.1% year-to-date and 34.5% over the past year.
Mixed Earnings Report
Hubbell’s stock experienced a 2.1% decline following the Q3 earnings release on Oct. 29, as net sales came in 2.6% below Wall Street forecasts. Notably, the company reported overall net sales growth of 4.9% from the previous year, totaling $1.4 billion, although organic sales experienced a slight decline of about 1%, with the growth primarily driven by acquisitions.
Despite these challenges, Hubbell reported an impressive improvement in profitability. The company saw a margin expansion of 180 basis points, raising the adjusted operating margin to 23.2%. Operating income also grew by 13.6% year-over-year, reaching $334.8 million. Additionally, its adjusted earnings per share (EPS) of $4.49 exceeded analysts’ expectations.
Future Outlook and Analyst Ratings
For the fiscal year ending in December, analysts predict a 7.4% year-over-year growth in HUBB’s adjusted EPS, forecasting a total of $16.47. Historically, Hubbell has demonstrated a strong earnings surprise track record, having beaten analysts’ estimates for four consecutive quarters.
The consensus rating for HUBB stock stands at “Moderate Buy.” Out of 11 analysts covering the stock, five recommend a “Strong Buy,” while six suggest a “Hold” rating.
Recent Analyst Coverage
This situation represents a slight increase in bullish sentiment from a month prior, when only four analysts promoted “Strong Buy” ratings. On Nov. 5, Bernstein analyst Chad Dillard initiated coverage with an “Outperform” rating and set a price target of $535, the highest on the Street, indicating a potential upside of 16.1%. Meanwhile, HUBB’s average price target of $473.22 suggests a 2.7% premium compared to current levels.
On the date of publication, Aditya Sarawgi did not hold any positions in the securities mentioned in this article. All information provided is for informational purposes. For further details, please view the Barchart Disclosure Policy here.
The views expressed in this article are those of the author and do not necessarily reflect those of Nasdaq, Inc.
