Have you been paying attention to shares of Pitney Bowes (PBI)? Shares have been on the move with the stock up 34.1% over the past month. The stock hit a new 52-week high of $9.95 in the previous session. Pitney Bowes has gained 34.8% since the start of the year compared to the 1.3% move for the Zacks Computer and Technology sector and the 34.8% return for the Zacks Office Automation and Equipment industry.

What's Driving the Outperformance?

The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 11, 2025, Pitney Bowes reported EPS of $0.32 versus consensus estimate of $0.16.

For the current fiscal year, Pitney Bowes is expected to post earnings of $1.21 per share on $1.97 billion in revenues. This represents a 47.56% change in EPS on a -25.23% change in revenues. For the next fiscal year, the company is expected to earn $1.31 per share on $1.98 billion in revenues. This represents a year-over-year change of 8.26% and 0.46%, respectively.

Valuation Metrics

Pitney Bowes may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.

Pitney Bowes has a Value Score of B. The stock's Growth and Momentum Scores are B and A, respectively, giving the company a VGM Score of A.

In terms of its value breakdown, the stock currently trades at 8.1X current fiscal year EPS estimates, which is not in-line with the peer industry average of 16.3X. On a trailing cash flow basis, the stock currently trades at 3.3X versus its peer group's average of 6X. Additionally, the stock has a PEG ratio of 0.54. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Zacks Rank

We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Pitney Bowes currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.

Story Continues

Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Pitney Bowes passes the test. Thus, it seems as though Pitney Bowes shares could have a bit more room to run in the near term.

How Does PBI Stack Up to the Competition?

Shares of PBI have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Canon, Inc. (CAJPY). CAJPY has a Zacks Rank of # 2 (Buy) and a Value Score of A, a Growth Score of D, and a Momentum Score of C.

Earnings were strong last quarter. Canon, Inc. beat our consensus estimate by 93.94%, and for the current fiscal year, CAJPY is expected to post earnings of $2.30 per share on revenue of $29.85 billion.

Shares of Canon, Inc. have gained 3.2% over the past month, and currently trade at a forward P/E of 14.2X and a P/CF of 12.32X.

The Office Automation and Equipment industry is in the top 2% of all the industries we have in our universe, so it looks like there are some nice tailwinds for PBI and CAJPY, even beyond their own solid fundamental situation.

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