Don’t count out manufacturing just yet. The Timken Company (TKR) is still expected to grow earnings by 15.4% in 2012 even though it had a record 2011. This Zacks #1 Rank (Strong Buy) is also cheap with a forward P/E of just 9.6.

Timken manufactures antifriction bearings and power transmission products and services as well as alloy steel and components.

Its friction management and power transmission services a variety of markets including aerospace, automotive, consumer, energy, heavy industry, power generation and rail.

Timken Surprised by 3.7% in the Fourth Quarter

On Jan 26, Timken reported its fourth quarter and full year results and beat the Zacks Consensus Estimate by 4 cents. The company has put together quite the earnings surprise track record as it was the 10th consecutive earnings surprise.

Earnings were $1.11 compared to the Zacks Consensus of $1.07 per share. It made just 87 cents a year ago.

The increase was due to higher volume, favorable mix, acquisitions, surcharges and pricing which easily offset the increased raw material and administrative costs.

Sales jumped 18% to $1.3 billion due to growth across most of the company’s end markets. Acquisitions were about 33% of the growth in the quarter. For the year, sales rose to a record $5.2 billion.

The 2012 Zacks Consensus Estimate Rises

Analysts are feeling optimistic. The 2012 Zacks Consensus Estimate has risen to $5.30 from $5.20 in the last 90 days.

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