The Conglomerates group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Federal Signal (FSS) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Conglomerates sector should help us answer this question.
Federal Signal is one of 15 individual stocks in the Conglomerates sector. Collectively, these companies sit at #7 in the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.
The Zacks Rank is a proven model that highlights a variety of stocks with the right characteristics to outperform the market over the next one to three months. The system emphasizes earnings estimate revisions and favors companies with improving earnings outlooks. Federal Signal is currently sporting a Zacks Rank of #2 (Buy).
Over the past three months, the Zacks Consensus Estimate for FSS' full-year earnings has moved 5% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.
Based on the latest available data, FSS has gained about 33.1% so far this year. In comparison, Conglomerates companies have returned an average of 3.3%. This means that Federal Signal is outperforming the sector as a whole this year.
Another Conglomerates stock, which has outperformed the sector so far this year, is ITT (ITT). The stock has returned 19.2% year-to-date.
The consensus estimate for ITT's current year EPS has increased 2% over the past three months. The stock currently has a Zacks Rank #2 (Buy).
Looking more specifically, Federal Signal belongs to the Diversified Operations industry, a group that includes 15 individual stocks and currently sits at #99 in the Zacks Industry Rank. On average, stocks in this group have gained 3.3% this year, meaning that FSS is performing better in terms of year-to-date returns. ITT is also part of the same industry.
Investors with an interest in Conglomerates stocks should continue to track Federal Signal and ITT. These stocks will be looking to continue their solid performance.
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Federal Signal Corporation (FSS): Free Stock Analysis Report ITT Inc. (ITT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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