Last week, we were reminded of the sheer power of nature.
Hurricane Ian leveled communities on the west coast of Florida — knocking out power to tens of thousands of people.
Except for one town.
Babcock Ranch, located northwest of Fort Myers, sustained the brunt of Ian … and suffered little damage, as well as no loss of electricity or internet.
This all-solar community’s infrastructure includes underground power and internet lines.
And it takes certain components to make that underground network sound:
The U.S. Census Bureau projects revenue generated from the sale of electrical equipment and components to increase 13% to $14 billion by 2024.
Today’s Power Stock manufactures key components for the energy, telecom and agriculture industries: Preformed Line Products Co. (Nasdaq: PLPC).
PLPC produces cable accessories used for above- and below-ground power and internet lines. It also makes mounts for commercial and residential solar installations.
Preformed Line Products stock scores a “Strong Bullish” 100 out of 100 on our Stock Power Ratings system, and we expect it to beat the broader market by 3X in the next 12 months.
PLPC Stock: Green Ratings Across the Board
Here’s what stood out from PLPC’s most recent earnings report:
- Revenue of $163.4 million is a 22.9% increase over the same time a year ago!
- For the first six months of 2022, sales are up 20.4% over the same period last year.
Those figures illustrate why PLPC earns an 86 on our growth rating.
But PLPC is an even better value stock.
Its price-to-earnings ratio is more than three times lower than the electrical equipment industry average.
What’s more, PLPC’s price-to-sales ratio is nearly nine times lower than the industry average.
This tells me Preformed Line stock is way undervalued compared to its peers.
PLPC stock traded flat for the first seven months of the year.
But the stock shot up more than 40% over 11 days in August.
The climb followed a summer of acquisitions that expanded the company’s footprint to Canada and the Czech Republic, along with a strong quarterly report.
Over the last 12 months, PLPC is up 13.8%, while its peers are down 7.8% on average.
Preformed Line stock scores a 100 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 three times in the next 12 months.
The story of Babcock Ranch shows how smart infrastructure can weather any kind of storm.
PLPC designs and manufactures products that make smart infrastructure possible … even with renewable energy.
You can see why PLPC is a strong candidate for your portfolio.
Bonus: The company’s forward dividend yield of 1.1% means it will pay $0.80 per share, per year just to own the stock.
Stay Tuned: U.S. Shale Oil Stock Helps Foil Putin
Remember: We publish Stock Power Daily five days a week to give you access to the top companies that our proprietary Stock Power Ratings identify!
Stay tuned for the next issue, where I’ll share all the details on a shale oil stock that is booming due to Russia’s invasion of Ukraine.
Matt Clark, CMSA®
Research Analyst, Money & Markets
P.S. PLPC is a leader in smart infrastructure for the power grid, but there’s a bigger mega trend within this industry that my colleague Adam O’Dell is tuned into.
I’m talking about renewable energy and battery storage.
To find out about Adam’s highest-conviction recommendations on this front, click here.
His No. 1 stock is already up almost 70% since March — in the middle of a bear market.
And he’s tracking this mega trend for more opportunities like this.