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Why You Should Add Ashland (ASH) Stock to Your Portfolio

Ashland Global Holdings Inc.’s ASH stock looks promising at the moment. It is benefiting from healthy demand across its end markets and disciplined pricing actions.

We are positive on the company’s prospects and believe that the time is right for you to add the stock to portfolio as it looks promising and is poised to carry the momentum ahead.

Let’s take a look into the factors that make this Zacks Rank #2 (Buy) stock an attractive choice for investors right now.

Estimates Northbound

Over the past three months, the Zacks Consensus Estimate for Ashland for fiscal 2023 has increased around 5.5%. The consensus estimate for fiscal 2024 has also been revised 3.9% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.

Healthy Growth Prospects

The Zacks Consensus Estimate for earnings for fiscal 2023 for Ashland is currently pegged at $6.36, reflecting an expected year-over-year growth of 11.6%. Moreover, earnings are expected to register a 7.3% growth in fiscal 2024.

Positive Earnings Surprise History

Ashland has outpaced the Zacks Consensus Estimate in each of the trailing four quarters. In this time frame, it has delivered an earnings surprise of roughly 4.5%, on average.

Growth Drivers in Place

Ashland is gaining from the strong momentum in its global pharma business. Strong demand for pharmaceutical ingredients is driving sales in its Life Sciences segment. Sales in the segment climbed 22% year over year in the first quarter of fiscal 2023, aided by double-digit growth to pharmaceutical customers. Ashland is also seeing a recovery across personal care ingredients and architectural coatings additives.

The company is also taking several actions, including reduction of operating costs to boost profitability. Cost-reduction measures are expected to support its margins in fiscal 2023. The company’s pricing measures are also contributing to its top-line growth. Its pricing and mix improvement actions are expected to cover the current inflation in raw material, freight, logistics and energy costs.

Ashland also remains committed to boosting its cash flows and returning value to shareholders. The company remains focused on expanding margins and improving free cash flow conversion. It is executing share buybacks under the $500-million evergreen stock repurchase program.

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Ashland Inc. Price and Consensus

 

Ashland Inc. Price and Consensus
Ashland Inc. Price and Consensus

Ashland Inc. price-consensus-chart | Ashland Inc. Quote

 

Other Stocks to Consider

Other top-ranked stocks worth considering in the basic materials space include Steel Dynamics, Inc. STLD, Olympic Steel, Inc. ZEUS and Yamana Gold Inc. AUY.

Steel Dynamics currently sports a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for STLD's current-year earnings has been revised 37.2% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 11.3%, on average. STLD has gained around 32% in a year.

Olympic Steel currently sports a Zacks Rank #1. The Zacks Consensus Estimate for ZEUS's current-year earnings has been revised 60.6% upward in the past 60 days.

Olympic Steel’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 26.2%, on average. ZEUS has rallied around 33% in a year.

Yamana Gold currently carries a Zacks Rank #2. The Zacks Consensus Estimate for AUY’s current-year earnings has been revised 3.8% upward in the past 60 days.

Yamana Gold beat Zacks Consensus Estimate in each of the last four quarters. It delivered a trailing four-quarter earnings surprise of 22.5% on average. AUY’s shares have gained roughly 6% in the past year.

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

Steel Dynamics, Inc. (STLD) : Free Stock Analysis Report

Ashland Inc. (ASH) : Free Stock Analysis Report

Yamana Gold Inc. (AUY) : Free Stock Analysis Report

Olympic Steel, Inc. (ZEUS) : Free Stock Analysis Report

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Zacks Investment Research