Wall Street Watch Tuesday: Signs of Life at Hillenbrand

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HillenbrandDeath care isn't a very attractive topic, but it shouldn't come as a surprise to learn that a company selling caskets, urns, and other funeral service products is generating steady financial results.

Hillenbrand (HI) posted reasonable quarterly results after Monday's market close.

Revenue climbed 10 percent to $254 million. Adjusted earnings climbed 6 percent to $31 million or $0.50 a share. Yes, you can achieve double-digit margins in a seemingly sleepy industry that many may be uncomfortable talking about.

Hillenbrand's growth wasn't all organic. This is a highly fragmented sector, and Hillenbrand has grown over the years by acquiring smaller players in death care.

In fact, the company's flagship Batesville casket business declined slightly during the period. A trend toward cremation over traditional burials and a welcome decline in overall deaths translated into Hillenbrand's other divisions being the -- umm -- pallbearers of growth.

The bottom line with Hillenbrand's report is that its adjusted profit of $0.50 a share was actually well ahead of the $0.42 a share that Wall Street was expecting. Death care may be a livelier investing niche than the market thinks.

Other Things Worth Watching

• Children's Place (PLCE) appointed a new CFO after the market closed on Monday. In a move to return more money to its shareholders, the retailer of toddler apparel also announced a $100 million share buyback program.

• Some folks play Monopoly in real life. Equity Residential (EQR) and AvalonBay Communities (AVB) announced late on Monday that they would be teaming up to acquire the Archstone Enterprise portfolio of apartment properties. The $16 billion deal is expected to close early next year.

• Las Vegas Sands (LVS) has become the latest company to declare a beefy distribution before dividend tax rates go up next year. The casino operator will cut a big check for investors to the tune of $2.75 a share. The distribution will set Las Vegas Sands back about $2.26 billion, and the checks will go out on Dec. 18 to take advantage of the last few days of qualified dividends being taxed at a modest 15 percent rate.

Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article. Motley Fool newsletter services have recommended buying shares of Hillenbrand.



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