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Reasons to Retain Donaldson (DCI) Stock in Your Portfolio
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Donaldson Company, Inc. (DCI - Free Report) has been benefiting from its focus on innovation, growth investments and a healthy demand scenario despite softness in the Mobile Solutions segment and rising costs.
Let us discuss the factors why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: A diversified business structure with exposure in various geographies and end markets like construction, mining, aerospace, defense, and food & beverage is a boon for the company. Continued strength in dust collection sales and power generation project timing within the industrial filtration solutions business are aiding the Industrial Solutions segment. Increasing defense sales within the Aerospace and Defense business also augur well for the segment.
Expansion Efforts: The company’s expansion initiative is expected to drive its growth. The company acquired Univercells Technologies in June 2023, which expanded its growing offering in the life sciences industry. Univercells is a part of Donaldson’s Life Sciences segment. The company acquired Isolere Bio in February 2023. The Isolere buyout enables Donaldson to create leading separation and filtration solutions for emerging genetic-based drugs and Isolere’s revenues are reported within the Donaldson Life Sciences segment.
Rewards to Shareholders: DCI continues to increase shareholders’ value through dividend payment & share repurchases. Dividend payments totaled $30.2 million in the first three months of fiscal 2024 (ended Oct 31, 2023). The company bought back shares worth $53.3 million in the first three months of fiscal 2024. It is worth noting that the company’s quarterly dividend was hiked 8.7% in May 2023. The company has raised its dividend for 27 consecutive years. For fiscal 2024 (ending July 2024), the company plans to buy back approximately 2% of its outstanding shares.
In the past year, shares of this current Zacks Rank #3 (Hold) company have increased 2.5% against the industry’s 6.2% decrease.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
EPAC delivered a trailing four-quarter average earnings surprise of 21.9%. In the past 60 days, the Zacks Consensus Estimate for Enerpac’s fiscal 2024 earnings has increased 2.3%. The stock has risen 15.4% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has remained steady in the past 60 days. Shares of Applied Industrial have jumped 34.3% in the past year.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has remained steady. The stock has risen 44.7% in the past year.
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Reasons to Retain Donaldson (DCI) Stock in Your Portfolio
Donaldson Company, Inc. (DCI - Free Report) has been benefiting from its focus on innovation, growth investments and a healthy demand scenario despite softness in the Mobile Solutions segment and rising costs.
Let us discuss the factors why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: A diversified business structure with exposure in various geographies and end markets like construction, mining, aerospace, defense, and food & beverage is a boon for the company. Continued strength in dust collection sales and power generation project timing within the industrial filtration solutions business are aiding the Industrial Solutions segment. Increasing defense sales within the Aerospace and Defense business also augur well for the segment.
Expansion Efforts: The company’s expansion initiative is expected to drive its growth. The company acquired Univercells Technologies in June 2023, which expanded its growing offering in the life sciences industry. Univercells is a part of Donaldson’s Life Sciences segment. The company acquired Isolere Bio in February 2023. The Isolere buyout enables Donaldson to create leading separation and filtration solutions for emerging genetic-based drugs and Isolere’s revenues are reported within the Donaldson Life Sciences segment.
Rewards to Shareholders: DCI continues to increase shareholders’ value through dividend payment & share repurchases. Dividend payments totaled $30.2 million in the first three months of fiscal 2024 (ended Oct 31, 2023). The company bought back shares worth $53.3 million in the first three months of fiscal 2024. It is worth noting that the company’s quarterly dividend was hiked 8.7% in May 2023. The company has raised its dividend for 27 consecutive years. For fiscal 2024 (ending July 2024), the company plans to buy back approximately 2% of its outstanding shares.
In the past year, shares of this current Zacks Rank #3 (Hold) company have increased 2.5% against the industry’s 6.2% decrease.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Enerpac Tool Group Corp. (EPAC - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
EPAC delivered a trailing four-quarter average earnings surprise of 21.9%. In the past 60 days, the Zacks Consensus Estimate for Enerpac’s fiscal 2024 earnings has increased 2.3%. The stock has risen 15.4% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The Zacks Consensus Estimate for AIT’s fiscal 2024 earnings has remained steady in the past 60 days. Shares of Applied Industrial have jumped 34.3% in the past year.
Crane Company (CR - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 29.8%.
In the past 60 days, the Zacks Consensus Estimate for Crane’s 2023 earnings has remained steady. The stock has risen 44.7% in the past year.