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Tennant Company (TNC - Free Report) has announced that it successfully completed the acquisition of China-based Gaomei Cleaning Equipment Company on Jan 4. Financial terms of the transaction have not been disclosed.
It is worth mentioning here that the company’s stock price increased roughly 5.4% since the transaction closed on Jan 4. The closing price was $55.59 on Jan 14.
Gaomei Cleaning Equipment specializes in manufacturing, and providing cleaning solutions for industrial and commercial purposes. Its product offerings include blowers, vacuum cleaners, high-pressure washers, single disc scrubbing machines, carpet extractors, floor scrubbers, and sweepers. This privately held company was founded in 1997.
Details of Buyout
Per the agreement, Gaomei Cleaning Equipment will retain its independence and will continue to operate in markets served.
Gaomei Cleaning Equipment’s efficient team, as well as technical expertise and solid product offerings, will solidify Tennant’s business in China markets. Further, Gaomei Cleaning Equipment’s specialization in understanding needs of mid-tier markets will be an added advantage for Tennant.
Tennant’s Buyout Strategies
The above-mentioned transaction is consistent with the company’s policy of acquiring businesses to gain access to improved product lines and enhance market exposure.
In April 2017, Tennant acquired Italy-based IP Cleaning S.p.A. and its subsidiaries (IPC Group) from private equity fund, Ambienta. The buyout was valued at approximately $353 million. IP Cleaning and its subsidiaries specialize in designing and manufacturing professional cleaning equipment, tools, and other solutions.
Since acquired, IP Cleaning’s product line has complemented Tennant’s existing offerings and enhanced its geographical presence. It is worth mentioning that the IP Cleaning acquisition contributed 8.7% to the company’s sales growth in the first nine months of 2018. On a geographical basis, this buyout increased sales generated from the Americas; Europe, the Middle East and Africa; and the Asia Pacific by 1.6%, 26.3% and 9.1%, respectively.
Zacks Rank & Other Key Picks
With a market capitalization of nearly $1 billion, Tennant currently carries a Zacks Rank #2 (Buy). In the quarters ahead, the company stands to benefit from solid product portfolio, expansion of geographical footprints, operational excellence and synergistic gains from acquired assets.
For 2018, the company raised its earnings per share forecast to $2.05-$2.15 from the previously stated $1.95-$2.10. Revenues are predicted to be $1.115-$1.125 billion, reflecting year-over-year growth of 11.2-12.2%. The sales guidance is above the previous anticipation of $1.10-$1.12 billion.
In the past 60 days, the Zacks Consensus Estimate for earnings on the stock remained unchanged at $2.11 for 2018 (results not yet released) and $2.38 for 2019. Moreover, estimates represent year-over-year growth of 37% for 2018 and 12.8% for 2019.
In the past month, the company’s shares gained 4.7%, outperforming the industry’s growth of 2.5%.
Some other top-ranked stocks in the industry are DXP Enterprises, Inc. (DXPE - Free Report) , Barnes Group, Inc. (B - Free Report) and Colfax Corporation . While DXP Enterprises currently sports a Zacks Rank #1 (Strong Buy), both Barnes and Colfax carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings estimates for these three companies for 2019 have improved over the past 60 days. Positive earnings surprise for the last four quarters was 112.62% for DXP Enterprises, 7.04% for Barnes and 8.88% for Colfax.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
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Tennant (TNC) Completes Gaomei Cleaning Equipment Buyout
Tennant Company (TNC - Free Report) has announced that it successfully completed the acquisition of China-based Gaomei Cleaning Equipment Company on Jan 4. Financial terms of the transaction have not been disclosed.
It is worth mentioning here that the company’s stock price increased roughly 5.4% since the transaction closed on Jan 4. The closing price was $55.59 on Jan 14.
Gaomei Cleaning Equipment specializes in manufacturing, and providing cleaning solutions for industrial and commercial purposes. Its product offerings include blowers, vacuum cleaners, high-pressure washers, single disc scrubbing machines, carpet extractors, floor scrubbers, and sweepers. This privately held company was founded in 1997.
Details of Buyout
Per the agreement, Gaomei Cleaning Equipment will retain its independence and will continue to operate in markets served.
Gaomei Cleaning Equipment’s efficient team, as well as technical expertise and solid product offerings, will solidify Tennant’s business in China markets. Further, Gaomei Cleaning Equipment’s specialization in understanding needs of mid-tier markets will be an added advantage for Tennant.
Tennant’s Buyout Strategies
The above-mentioned transaction is consistent with the company’s policy of acquiring businesses to gain access to improved product lines and enhance market exposure.
In April 2017, Tennant acquired Italy-based IP Cleaning S.p.A. and its subsidiaries (IPC Group) from private equity fund, Ambienta. The buyout was valued at approximately $353 million. IP Cleaning and its subsidiaries specialize in designing and manufacturing professional cleaning equipment, tools, and other solutions.
Since acquired, IP Cleaning’s product line has complemented Tennant’s existing offerings and enhanced its geographical presence. It is worth mentioning that the IP Cleaning acquisition contributed 8.7% to the company’s sales growth in the first nine months of 2018. On a geographical basis, this buyout increased sales generated from the Americas; Europe, the Middle East and Africa; and the Asia Pacific by 1.6%, 26.3% and 9.1%, respectively.
Zacks Rank & Other Key Picks
With a market capitalization of nearly $1 billion, Tennant currently carries a Zacks Rank #2 (Buy). In the quarters ahead, the company stands to benefit from solid product portfolio, expansion of geographical footprints, operational excellence and synergistic gains from acquired assets.
For 2018, the company raised its earnings per share forecast to $2.05-$2.15 from the previously stated $1.95-$2.10. Revenues are predicted to be $1.115-$1.125 billion, reflecting year-over-year growth of 11.2-12.2%. The sales guidance is above the previous anticipation of $1.10-$1.12 billion.
In the past 60 days, the Zacks Consensus Estimate for earnings on the stock remained unchanged at $2.11 for 2018 (results not yet released) and $2.38 for 2019. Moreover, estimates represent year-over-year growth of 37% for 2018 and 12.8% for 2019.
Tennant Company Price and Consensus
Tennant Company Price and Consensus | Tennant Company Quote
In the past month, the company’s shares gained 4.7%, outperforming the industry’s growth of 2.5%.
Some other top-ranked stocks in the industry are DXP Enterprises, Inc. (DXPE - Free Report) , Barnes Group, Inc. (B - Free Report) and Colfax Corporation . While DXP Enterprises currently sports a Zacks Rank #1 (Strong Buy), both Barnes and Colfax carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings estimates for these three companies for 2019 have improved over the past 60 days. Positive earnings surprise for the last four quarters was 112.62% for DXP Enterprises, 7.04% for Barnes and 8.88% for Colfax.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>