Harbin Electric, Inc. (
HRBN) just announced some positive third-quarter numbers that have pushed its share price higher by approximately 6% today.
As a result, HRBN is a top-performing Zacks #1 Rank company for Tuesday. Volume is nearing 500,000 shares, which is well above the daily average of nearly 368,000.
Analysts have boosted earnings estimates on the company in the past month, and more upward revisions could be on the way in the coming days.
Harbin Electric is a Chinese company that develops and manufactures a wide array of electric motors with a focus on innovative, customized and value-added products. Major product lines include industrial rotary motors, linear motors and specialty micro-motors.
HRBN is part of the Zacks #1 Rank List under the Machinery-Electrical industry. The only other company from this space that's highlighted is A.O. Smith Corporation (AOS).
Third-Quarter Report
According to Harbin Electric, robust orders in oil pumps and industrial rotary motors in China helped to offset continued weakness in specialty micro motors and overseas sales.
Total revenues climbed 18% year over year to $46.93 million, thanks to growth in the linear motor and industrial rotary motor businesses. (International sales slumped 45% thanks to the tough economies here in North America.)
Adjusted earnings per share reached 40 cents, marking a positive earnings surprise of more than 90% over the Zacks Consensus Estimate. The result also marked a more than 17.5% advance over the previous year's 34 cents.
Harbin Electric has a pretty good record of meeting or surpassing the quarterly Zacks Consensus Estimate. In the past 4 quarters, it has beaten 3 times and matched once, amassing an average surprise of about 30%.
The company called this quarter "yet another significant period on our way to becoming a global leader in the electric motor industry". HRBN expects operating results to remain strong in the fourth quarter.
Acquisition Complete
Also during the quarter, Harbin Electric completed its acquisition of Xi'an Simo Motor Incorporation (now dubbed Xi'an Tech Full Simo Motor Co. Ltd.).
HRBN said the integration and consolidation of Simo Motor's business is moving smoothly. The acquisition is expected to contribute to total operating results beginning next year.
Harbin Electric had stated that the acquisition is the most significant step to date in its strategy to expand to large size and special type of rotary motors. It should also further strengthen HRBN's leading position in the electric motor industry in China.
Earnings Estimates
Earnings estimates on Harbin Electric for both this year and next remain above levels from 30 days ago, probably stemming either from the completed acquisition of Simo Motor on Oct 19, or the announcement of the acquisition on Oct 6.
The Zacks Consensus Estimate for this year is currently at $1.35 per share, marking a gain of 17.4% from $1.15 a month ago. One of 2 covering analysts contributed to this gain.
Meanwhile, the Zacks Consensus Estimate for next year has advanced 22% in the past month to $1.82 per share from $1.49, thanks to upward revisions from 2 of 3 covering analysts. This outlook also suggests that Harbin Electric could put together year-over-year profit growth of nearly 35%.
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