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Here's Why Hold Strategy is Apt for Ingersoll Rand (IR) Stock

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Ingersoll Rand Inc. (IR - Free Report) is benefiting from strength across its diverse end markets, including mining & construction, energy, transportation, medical and industrial manufacturing despite headwinds from logistics and direct material cost inflation, and supply-chain challenges. Also, strength in the company’s food, life science, water and clean energy businesses are anticipated to drive performance in the near term.

IR expects its Industrial Technologies & Services segment to grow on the back of a robust product portfolio of compressors, industrial vacuum and blowers, and power tools. Strengthening air dimensions business will likely drive its Precision & Science Technologies segment.

In October 2022, Ingersoll Rand inked a deal to acquire Everest Blowers Private Limited and Everest Blower Systems Private Limited (collectively, Everest Group) and Airmax Groupe. The addition of Everest Group will expand Ingersoll Rand’s presence in India with complementary products including customized blower and vacuum pump solutions as well as in sustainable end markets including water treatment, pharma, food and beverage. The Airmax acquisition will allow Ingersoll Rand to leverage its local market knowledge and energy optimization expertise. In the same month, IR inked a deal to acquire SPX FLOW’s Air Treatment unit. The buyout is expected to boost IR’s product offerings in the compressor vertical. The acquired entity will be integrated into IR’s IT&S segment.

The buyout of Dosatron International (October 2022) expanded its digital technology portfolio, opening up opportunities in hydroponics, horticulture, animal health, food safety, along with sanitation and water treatment end markets. IR’s September 2022 acquisition of Westwood Technical Limited expanded its IIoT offerings with Westwood Technical’s Aircom product line. It’s worth noting that in third-quarter 2022, buyouts drove IR’s revenues by 3.8%.

IR is committed to rewarding its shareholders handsomely with dividend payments and share buybacks. In the first nine months of 2022, the company paid out dividends worth $24.3 million and repurchased treasury stocks worth $257.8 million. The dividend rate was hiked by 7% in February, 2022.

 

In light of the above-mentioned positives, we believe, investors should hold on to the Ingersoll Rand stock for now, as is suggested by its current Zacks Rank #3 (Hold).

Stocks to Consider

Some better-ranked companies from the Industrial Products sector are discussed below:

Applied Industrial Technologies, Inc. (AIT - Free Report) presently sports a Zacks Rank #1 (Strong Buy) and has a trailing four-quarter earnings surprise of 24.8%, on average. You can see the complete list of today’s Zacks #1 Rank stocks.

AIT’s earnings estimates have increased 4.6% for fiscal 2023 in the past 60 days. Shares of Applied Industrial have risen 28.2% in the past year.

MRC Global Inc. (MRC - Free Report) presently has a Zacks Rank of 1. MRC’s earnings surprise in the last four quarters was 103%, on average.

In the past 60 days, MRC Global’s earnings estimates have increased 42% for 2022. The stock has rallied 67.2% in the past year.

Titan International, Inc. presently carries a Zacks Rank #2 (Buy). Its earnings surprise in the last four quarters was 49.6%, on average.

In the past 60 days, TWI’s earnings estimates have increased 1.4% for 2022. The stock has surged 70.7% in the past year.

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