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DXP Enterprises (DXPE) Acquires Premier Water, Expands Offerings

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DXP Enterprises, Inc. (DXPE - Free Report) yesterday announced that it acquired Charlotte, NC-based Premier Water. The financial aspects of the transaction have been kept under wraps.

The deal was originally announced on Sep 20, 2021, Yesterday, DXP Enterprises’ shares gained 0.11%, ending the trading session at $27.22.

Premier Water is a specialist in providing products and services for use in the wastewater and water treatment markets. It has a solid customer base in North and South Carolina. Revenue generated totaled $3.6 million and adjusted earnings before interest, tax, depreciation and amortization were $850,000.

Inside the Headlines

With the addition of Premier Water, DXP Enterprises is well-positioned to leverage benefits from its extended product and service offerings, customer base, and end-market exposure. Treatment and products offered by Premier Water include aeration equipment, gates and valves, disinfection and chemical feed, odor control, air treatment, and filtration.

DXP Enterprises anticipates a boost to its offerings in the water and wastewater market with the buyout. Also, Premier Water is expected to complement DXP Enterprises’ Carter & Verplanck acquisition. Notably, Carter & Verplanck was acquired by DXP Enterprises in May 2021.

Based in Tampa, FL, Carter & Verplanck engages in providing solutions related to potable water management and wastewater treatments. It has a solid customer base in Georgia, Florida, Alabama and Tennessee markets.

DXP Enterprises’ Buyout Activities

The company believes in acquiring businesses/assets in an attempt to gain access to new customers, end markets and product lines.

In addition to Premier Water and Carter & Verplanck buyouts in 2021, DXP Enterprises announced the acquisitions of Pumping Solutions, Inc., Total Equipment Company, and APO Pumps & Compressors (includes Corporate Equipment Company) in January. Agreements for the buyouts were signed on Dec 31, 2020.

The buyouts provided DXP Enterprises solid growth opportunities in the water and wastewater, industrial, and commercial end markets. Also, the company’s aftermarket and service capabilities received a boost.

Zacks Rank, Price Performance and Earnings Estimate Trend

With a market capitalization of $522 million, DXP Enterprise currently sports a Zacks Rank #1 (Strong Buy). The company is poised to benefit from the exposure in diversified end markets, improving demand, solid execution and synergistic gains from buyouts.

In the past three months, the company’s shares have dipped 16.6% compared with the industry’s decline of 3.8%.


Zacks Investment Research
Image Source: Zacks Investment Research


The Zacks Consensus Estimate for DXP Enterprises’ earnings is pegged at $1.35 for 2021 and $2.40 for 2022, reflecting increases of 70.9% and 24.4% from the respective 60-day-ago figures.

DXP Enterprises, Inc. Price and Consensus


DXP Enterprises, Inc. Price and Consensus

DXP Enterprises, Inc. price-consensus-chart | DXP Enterprises, Inc. Quote

Other Stocks to Consider

Three other top-ranked stocks in the industry are Helios Technologies, Inc. (HLIO - Free Report) , Kadant Inc. (KAI - Free Report) and Applied Industrial Technologies, Inc. (AIT - Free Report) . While both Helios and Kadant currently sport a Zacks Rank #1, Applied Industrial carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, earnings estimates for the companies improved for the current year. Also, earnings surprise in the last reported quarter was positive 39.53% for Helios, 33.11% for Kadant and 27.97% for Applied Industrial.