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Solid Q3 earnings to drive Snap-on stock higher

Snap-on, a global provider of professional tools, equipment, and related solutions for vehicle service centers and other industrial users, issued solid Q3 financials. Organic revenue growth was 7.3% on the back of factors like rising penetration in emerging markets, continued software and hardware upgrades, productivity enhancements. Operating margin expanded 130 basis points, and adjusted earnings per share jumped 12.5% to $1.98 topping consensus estimate of $1.93. To note, Snap-on has an excellent earnings track record, with the company delivering positive average earnings surprise of 5.55%, in the last four trailing quarters, beating the estimates all through.

Recently, Snap-on breached its 50-day moving average in a bullish manner, and solid Q3 earnings also allowed it to surpass a $164 resistance level. The stock, in my opinion still has a room for growth, with the nearest technical aim at $170. Medium-term target is $175.