Some of the best times I remember with my grandfather were sitting down and listening to him tell me about everything that goes into producing just one airplane.
As an engineer with Boeing, he had a lot of insight.
It amazed me to learn just how complex the process was to build just a wing, an engine, a fuselage … you name it!
All kinds of metals, plastics, fluids and specialty products are used to make just one aircraft.
And from 2021 to 2030, Precedence Research projects the aerospace materials market to jump 85.2%. You can see their projections rising over that period in the chart below:
That kind of increase certainly stands out, so I like to look to our Stock Power Ratings system for ways to capitalize.
I found one stock that should deliver … ESCO Technologies Inc. (NYSE: ESE).
This is a company that manufactures a wide range of specialty products for the aerospace and defense industries, and it’s today’s Power Stock.
Through its subsidiaries, ESE produces everything from specialized metal to fluid control systems used in commercial and military aircraft.
ESE stock scores a "Strong Bullish" 85 out of 100 on our Stock Power Ratings system, as shown below.
ESE's Stock Power Ratings in February 2023.
We expect it to beat the broader market by 3X in the next 12 months.
ESCO Technologies Stock: Strong Quality + “Maximum Momentum”
ESE recently closed out a strong quarter:
- Sales were $205.5 million — a 16.1% jump from the same period a year ago!
- The company’s commercial aerospace sales for the quarter were $30 million — up 30% from last year!
ESE stock is strong on our quality factor, where it scores 81.
The company sports positive returns on assets, equity and investment … all while its industry peers average slight positive or even negative returns.
This tells us the company knows how to churn out profits — which is great for investors.
Let’s get into ESCO Technologies stock’s market-beating momentum.
The following chart shows that from its May 2022 low to its recent February high, ESE posted a 65.9% gain.
Created in February 2023.
The stock is only 5.8% off its high … and I’m confident it’s going to hit it and go higher. It’s showing the “maximum momentum” we love to see in stocks.
Over the last 12 months, ESE stock has jumped 34%. Its machinery manufacturing peers are averaging a 7.5% gain over the same time.
ESCO Technologies stock scores an 85 overall on our proprietary Stock Power Ratings system.
That means we're “Strong Bullish” and expect it to beat the broader market by at least 3X in the next 12 months.
Bonus: ESE’s 0.33% forward dividend yield means shareholders collect an additional $0.32 per share, per year.
As I mentioned earlier, there’s a lot that goes into producing just one aircraft … metals, electronics, plastics … and more. It’s all part of the aircraft manufacturing process.
And ESCO Technologies stock is a strong contender for your portfolio as it produces a wide array of products used to manufacture commercial and military aircraft.
Friendly Reminder: Markets Are Closed for President’s Day
U.S. markets will be closed on Monday, so I’ll be back on Tuesday with another top-rated stock — this time from the agriculture industry.
Stay tuned!
Safe trading,
Matt Clark, CMSA®
Research Analyst, Money & Markets