Toro (TTC) Scales A 52-Week High On Strong Q3, View

Shares of Toro Co. (NYSE:TTC) scaled a new 52-week high of $99.00 on Aug 26, before settling lower at $97.98. Toro's share price has been on the rise since the company posted record third-quarter fiscal 2016 results on Aug 18. Further, its new product line-up for 2016 and positive outlook for growth also led to stock price appreciation.

This Bloomington, MN-based provider of turf and landscape maintenance equipment as well as irrigation solutions for golf courses has a market cap of $5.39 billion. Average volume of shares traded over the last three months is approximately 327K.

Toro has delivered year-to-date returns of around 34.09%. The company has outperformed the Zacks Consensus Estimate in three of the four trailing quarters, with an average positive surprise of 9.42%.

Growth Drivers

Toro reported record third-quarter fiscal 2016 (ended Jul 29) earnings of $1.00 per share, which increased 6% from the 94 cents in the year-ago quarter. Earnings came in line with the Zacks Consensus Estimate and surpassed management guidance of 95 cents per share. Despite challenging weather and currency conditions, and the resulting negative impact on revenues, the company delivered another impressive quarter of record earnings.

Toro witnessed strong sales in the professional segment driven by new product introductions. The company is seeing positive momentum from the specialty construction business. There has been a strong demand for the new Dingo TX 1000 compact utility loader, which was well received by landscape contractors and rental houses alike. Overall, Toro remains focused on innovation, productivity and profitable growth.

During the fourth quarter the company continues to witness positive retail sales across its businesses. Further, in the snow and ice management businesses, the company is well positioned with new innovative products as the preseason begins to set in.

The current forecasts by the American Rental Association suggest rental and construction markets will remain strong for the remainder of 2016 and into next year. The rental and specialty construction businesses have a solid order lineup for the fourth quarter.

At present, Toro has a Zacks Rank #4 (Sell).

Stocks to Consider

Some better-ranked stocks in the consumer discretionary sector include American Woodmark Corp. (NASDAQ:AMWD) , Cable ONE, Inc. (NYSE:CABO) and Central Garden & Pet Company (NASDAQ:CENT) . All these stocks sport a Zacks Rank #1 (Strong Buy).