Have you been paying attention to shares of Strattec Security (STRT)? Shares have been on the move with the stock up 24.6% over the past month. The stock hit a new 52-week high of $49.64 in the previous session. Strattec Security has gained 20.2% since the start of the year compared to the -10.6% move for the Zacks Auto-Tires-Trucks sector and the 3.8% return for the Zacks Automotive - Original Equipment industry.
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 6, 2025, Strattec Security reported EPS of $0.65 versus consensus estimate of $0.28.
For the current fiscal year, Strattec Security is expected to post earnings of $3.67 per share on $551.82 million in revenues. This represents a -9.83% change in EPS on a 2.61% change in revenues. For the next fiscal year, the company is expected to earn $3.84 per share on $570.5 million in revenues. This represents a year-over-year change of 4.63% and 3.39%, respectively.
Strattec Security may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Strattec Security has a Value Score of A. The stock's Growth and Momentum Scores are A and A, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 13.5X current fiscal year EPS estimates, which is a premium to the peer industry average of 11X. On a trailing cash flow basis, the stock currently trades at 6.1X versus its peer group's average of 6.5X. Additionally, the stock has a PEG ratio of 1.35. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Strattec Security currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Strattec Security fits the bill. Thus, it seems as though Strattec Security shares could have potential in the weeks and months to come.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Strattec Security Corporation (STRT) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.