Zacks Investment Research Reiterates “Sell” Rating for ABM Industries (ABM)

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Zacks Investment Research restated their sell rating on shares of ABM Industries (NYSE:ABM) in a research note issued to investors on Monday morning.

According to Zacks, “Shares of ABM Induistries have underperformed its industry's growth over the past year. Increasing expenses (due to expenses related to GCA-buyout and higher wage and overtime costs resulting from a tight labor market) has become a concern for ABM Industries as it is likely to weigh on its bottom line. A debt-laden balance sheet is another major headwind. Despite such negatives, ABM's strategy to grow through acquisitions while maintaining desirable profit margins have paid off with top line growth. The company has embarked on 2020 Vision that outlines its long-term vision for the next five years. Systematic and strategic plans of actions are likely to drive long-term profitable growth for ABM through an industry-based go-to-market approach. The company has been consistent in rewarding its shareholders. “

Several other research analysts have also weighed in on ABM. ValuEngine lowered ABM Industries from a hold rating to a sell rating in a report on Thursday, September 27th. TheStreet raised ABM Industries from a c+ rating to a b- rating in a research note on Friday, September 14th. Finally, Robert W. Baird downgraded ABM Industries from an outperform rating to a neutral rating and lifted their price target for the company from $36.00 to $40.00 in a research note on Thursday, August 23rd. They noted that the move was a valuation call.

ABM stock opened at $31.16 on Monday. The company has a debt-to-equity ratio of 0.69, a quick ratio of 1.61 and a current ratio of 1.61. The stock has a market cap of $1.98 billion, a price-to-earnings ratio of 17.81 and a beta of 0.71. ABM Industries has a 1-year low of $28.17 and a 1-year high of $44.70.

ABM Industries (NYSE:ABM) last posted its earnings results on Thursday, September 6th. The business services provider reported $0.57 earnings per share for the quarter, topping the Thomson Reuters’ consensus estimate of $0.53 by $0.04. The firm had revenue of $1.62 billion for the quarter, compared to analyst estimates of $1.65 billion. ABM Industries had a return on equity of 7.75% and a net margin of 1.34%. The company’s revenue for the quarter was up 23.2% on a year-over-year basis. During the same period in the previous year, the company posted $0.51 earnings per share. Analysts predict that ABM Industries will post 1.88 earnings per share for the current year.

The company also recently declared a quarterly dividend, which was paid on Monday, November 5th. Shareholders of record on Thursday, October 4th were paid a $0.175 dividend. This represents a $0.70 annualized dividend and a dividend yield of 2.25%. The ex-dividend date of this dividend was Wednesday, October 3rd. ABM Industries’s dividend payout ratio is 40.00%.

In other ABM Industries news, SVP Dean A. Chin sold 5,682 shares of ABM Industries stock in a transaction dated Friday, September 7th. The stock was sold at an average price of $33.60, for a total value of $190,915.20. Following the sale, the senior vice president now owns 32,847 shares of the company’s stock, valued at approximately $1,103,659.20. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider Scott B. Salmirs sold 6,239 shares of ABM Industries stock in a transaction dated Wednesday, September 12th. The shares were sold at an average price of $33.98, for a total value of $212,001.22. Following the completion of the sale, the insider now directly owns 120,693 shares in the company, valued at approximately $4,101,148.14. The disclosure for this sale can be found here. Insiders sold a total of 13,939 shares of company stock worth $464,243 in the last three months. Company insiders own 1.30% of the company’s stock.

Several institutional investors and hedge funds have recently added to or reduced their stakes in the business. BlackRock Inc. raised its stake in shares of ABM Industries by 3.6% in the 3rd quarter. BlackRock Inc. now owns 9,601,518 shares of the business services provider’s stock valued at $309,650,000 after purchasing an additional 332,496 shares during the period. FMR LLC raised its stake in shares of ABM Industries by 117.2% in the 3rd quarter. FMR LLC now owns 6,861,160 shares of the business services provider’s stock valued at $221,272,000 after purchasing an additional 3,702,812 shares during the period. Dimensional Fund Advisors LP raised its stake in shares of ABM Industries by 15.5% in the 3rd quarter. Dimensional Fund Advisors LP now owns 3,993,373 shares of the business services provider’s stock valued at $128,786,000 after purchasing an additional 537,375 shares during the period. Macquarie Group Ltd. increased its position in shares of ABM Industries by 24.2% in the third quarter. Macquarie Group Ltd. now owns 1,853,910 shares of the business services provider’s stock valued at $59,789,000 after acquiring an additional 361,404 shares during the last quarter. Finally, Bank of America Corp DE increased its position in shares of ABM Industries by 61.8% in the second quarter. Bank of America Corp DE now owns 1,766,838 shares of the business services provider’s stock valued at $51,557,000 after acquiring an additional 675,127 shares during the last quarter.

ABM Industries Company Profile

ABM Industries Incorporated provides integrated facility solutions in the United States and internationally. The company operates through Business & Industry, Aviation, Technology & Manufacturing, Education, Technical Solutions, and Healthcare segments. It offers janitorial, electrical and lighting, energy solutions, facilities engineering, HVAC and mechanical, landscape and turf, mission critical solutions, and parking.

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