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Here's Why You Should Consider Buying Middleby (MIDD) Stock

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On May 13, we issued an updated research report on The Middleby Corporation (MIDD - Free Report) .

Existing Business Scenario

Middleby is poised to gain from investments in product innovation and technological-advancement actions. The company’s investment in proprietary antimicrobial technology, along with the launch of Middleby Innovation Kitchens in the first quarter of 2021, is likely to act as a tailwind. Also, signs of recovery in restaurant, travel and leisure industries might prove advantageous in the quarters ahead. In addition, healthy home sales trend, revival in new construction, digital marketing actions, product innovations and sales initiatives are likely to create growth opportunities.

Also, the company’s robust liquidity position adds to its strength. Notably, in the first quarter, its cash flow from operations totaled $59.7 million, despite the increase in working capital of almost $100 million from sales growth to support higher demand. In addition, its cash and cash equivalents were $309.3 million, up 15.4% from $268.1 million on a sequential basis.

Moreover, it believes in gaining market share and boosting growth opportunities through acquisitions. It completed the buyout of RAM Fry Dispensers in January 2020, which has strengthened its product offerings in the restaurant automation platform. Also, the company’s acquisition of Wild Goose Filling (December 2020) has been strengthening prospects for Middleby in the canned beverages market. This apart, its buyout of Welbilt, Inc. (April 2021) will allow it to enhance its Commercial Foodservice platform with solid portfolio of products, brands and technologies. Notably, acquired assets boosted its sales by 1.3% and 1.8% in fourth-quarter 2020 and first-quarter 2021, respectively.

Some of the companies in the industry that compete with Middleby are Illinois Tool Works Inc. (ITW - Free Report) , Welbilt, Inc. and Dover Corporation (DOV - Free Report) .

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