The ARB Corporation Limited (ASX: ARB) share price has been a winner on the charts over the last 3 weeks.
Whereas the S&P / ASX 200 Index (ASX: XJO) has posted a return of around 1% over the last week, ARB shares have climbed more than 7% into the green over that time. And that gain climbs to more than 16% over the last three weeks.
Here we cover the tailwinds behind ARB shares in the last few weeks.
Quick recap on ARB Corp
ARB is the largest manufacturer of four-wheel-drive accessories in Australia. Although it has a strong local presence, ARB also exports its products into more than 100 markets across the globe.
At the time of writing, ARB has a market capitalisation of $3.9 billion.
What’s been driving the ARB share price?
ARB last updated the market on 14 July, when it released its unaudited sales results for the year ended 30 June 2021.
The company advised it had recognised unaudited revenue of $623 million for FY21, signifying an approximate 40% year-on-year growth schedule.
According to the release, this carried through the income statement to record unaudited profit before tax “within the range of $145 million to $150 million”.
Both of these estimates came in well above the consensus of analyst expectations at 21% revenue growth and net profit of $94.4 million. The ARB share price soared on the news.
Moreover, the company expects to release its audited final results for FY21 on 17 August.
ARB says it “maintains a positive short-term outlook based on its consistently strong customer order book”, in line with results this year.
In addition to outperformance at the company level, analyst sentiment is positive around ARB shares.
For instance, Celeste Funds Management is bullish on the ARB share price. It says the Australian four-wheel-drive sales remain strong and the outlook appears positive, amid a myriad of other factors.
Eric Nguyen, analyst at Celeste, was quoted as saying: “ARB has an articulated product and partner strategy to significantly grow sales and earnings over the next 5-plus years.”
Nguyen also believes ARB shares continue to “offer compelling value” when examining underlying earnings over the next 5 to 10 years.
ARB share price snapshot
The ARB share price has posted a year-to-date return of 54%, extending the previous 12 month’s return of 142%.
Both of these returns have outpaced the broad index’s return of around 26% over the past year.
At today’s close, ARB shares were swapping hands for $47.78 apiece, up 0.08% on the previous closing price.