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
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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