(ATI) - When compared to the prior-year period, earnings were up an impressive 51.5%

Allegheny Technologies Incorporated (ATI), a stock that we first presented on Apr 5, 2006, has remained a Zacks #1 Rank. The company bettered the Street's earnings estimate in five consecutive quarters, most recently by 44.9%. Consensus earnings estimates have been on the rise. ATI's return on equity crushes that of the industry average—50% compared to 20%. Full Analysis Allegheny Technologies Incorporated is one of the world's largest and most diversified producers of specialty materials. The company operates production facilities, service centers and sales offices throughout the United States and in 17 other countries. ATI operates in three business segments: high performance metals, flat rolled products and engineered products When ATI was first highlighted as a Growth and Income stock on Apr 5, 2006, the company held our highest rating-Zacks #1 Rank. Today, it still holds that honor due to its history of exceeding analysts' earnings expectations and because of upwardly revised estimates. On Apr 26, 2006, the company crushed the Street's first-quarter earnings estimate of 69 cents by a stellar 44.9% when it posted profits of $1.00 per share. When compared to the prior-year period, earnings were up an impressive 51.5%. This marked the fifth straight quarter that produced a positive earnings surprise for ATI. Revenues jumped 18% to $1.04 billion from $879.6 million a year earlier, fueled by a 57% increase in the high performance metals segment and 21% in the engineered products division. Looking ahead, Patrick Hassey, the company's chairman, president and CEO stated, "The outlook remains strong for our major markets." The company's markets include defense, chemicals and energy. Earnings per share are projected to grow 20% over the next 3-5 years, with the industry expected to experience growth of 18%. ATI plans to release its financial results for the second quarter on Jul 26, 2006. On Jun 26, 2006, ATI announced a $325 million investment in a greenfield premium-grade titanium sponge facility to be built in Rowley, UT, with an annual capacity of 24 million pounds. This will increase the company's capacity to produce titanium alloys to about 40 million pounds. The plant will help it further cater to both the aerospace and defense markets and should begin production in the third quarter of 2008. In the three months since ATI was first featured, analysts have grown more optimistic, revising their earnings estimates upward. Consensus estimates for this quarter and next quarter increased 41.8% and 31.4%, respectively. Profit forecasts for this year and next ballooned 36.8% and 38.8%, respectively, over the same time period. When measuring ATI's profitability via its return on equity, investors should be very impressed. The company has a return on equity more than twice that of the industry average-50% compared to 20%. ATI is currently yielding 0.61% and has a five-year average dividend yield of 3.9%. Note: The Zacks Rank is a very sensitive indicator that can change frequently for an individual stock. This important indicator is updated daily on Zacks.com and is available to Zacks Premium subscribers. As such, it is prudent to check the site for the latest Zacks Rank on the stocks highlighted in this section. Simply click the link for the stock or enter the symbol in the ticker entry box in the upper left hand corner of the web site. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. Blog Home