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5-Star Stocks Poised to Pop: K-Tron International

By Brian D. Pacampara, CFA - Updated Apr 5, 2017 at 8:02PM

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Market-trouncing returns could be written in these five stars.

Based on the aggregated intelligence of the 120,000 investors participating in Motley Fool CAPS, the Fool's free investing community, material-handling equipment maker K-Tron International (NASDAQ:KTII) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.

With that in mind, let's take a closer look at K-Tron's business, and see what CAPS investors are saying about the stock right now.

K-Tron facts

Headquarters (founded)

Pitman, N.J. (1964)

Market Cap

$223.14 million

Industry

Industrial machinery

Trailing-12-Month Revenue

$236.29 million

Management

CEO Edward Cloues II (since 1998)
CFO Ronald Remick (since 1999)

Return on Equity (average last three years)

23.7%

Competitors

Badger Meter (NYSE:BMI)
Key Technology (NASDAQ:KTEC)

CAPS members bullish on KTII also bullish on:

Apple (NASDAQ:AAPL)
Vale (NYSE:RIO)

CAPS members bearish on KTII also bearish on:

Morgan Stanley (NYSE:MS)
PotashCorp (NYSE:POT)

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.

Over on CAPS, 97% of the 402 members who have rated K-Tron believe the stock will outperform the S&P 500 going forward. These bulls include fdude71 and randyriv.

Last month, fdude71 explained why K-Tron was a good idea:

good small cap in a good industry.
international exposure.
good mgt ...
good time to get in.

In an earlier pitch from late October, randyriv elaborates on the bull case, writing:

A rare small-cap with global presence and great management. K-Tron serves niche markets in the food, drug, and energy sectors (can you say recession-proof?). Close to 40% of the company's revenue is generated overseas. Management is top-notch and has a knack for making acquisitions that quickly become accretive to earnings.

In 2007, [K-Tron] grew revenues and earnings by 36% and 63% respectively. Given the company's management, size, and the markets it serves, there's no reason to believe that K-Tron can't continue its strong growth trend over the next few years.

What do you think about K-Tron, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. K-Tron is a Motley Fool Hidden Gems Pay Dirt recommendation. Apple is a selection of Stock Advisor. The Fool owns shares of K-Tron. The Fool's disclosure policy always gets a perfect score.

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Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$169.24 (2.62%) $4.32
Morgan Stanley Stock Quote
Morgan Stanley
MS
$88.89 (2.93%) $2.53
Rio Tinto plc Stock Quote
Rio Tinto plc
RIO
$61.71 (0.60%) $0.37
Nutrien Stock Quote
Nutrien
POT

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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