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Donaldson Gears Up to Report Q3 Earnings: What's in the Offing?

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Donaldson Company, Inc. (DCI - Free Report) is scheduled to release third-quarter fiscal 2025 (ended April 30) results on June 3, before market open.

The company’s earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters, while missing the mark in one. The average surprise was 3.8%. In the last reported quarter, its earnings of 83 cents per share missed the Zacks Consensus Estimate of 85 cents by 2.4%. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Let’s see how things have shaped up for Donaldson this earnings season.

Factors to Note

In the third quarter of fiscal 2025, the Industrial Solutions segment’s results are expected to benefit from strong momentum in the commercial aerospace market. This growth was driven by increased demand for new equipment and solid demand in defense markets, arising from higher orders and porting activity. Persistent strength in the aerospace and defense business is likely to have aided the company’s performance as well. The Zacks Consensus Estimate for the segment’s revenues is pegged at $284 million, indicating a 5.6% jump from the year-ago reported number.

The Life Sciences segment has been reaping the benefits from an increase in demand for disk drives, and food & beverage products in Europe, the Middle East and Africa, and the Asia Pacific region. The consensus mark for the segment’s revenues is pegged at $75 million, which implies a 1.4% increase from the year-ago reported figure.

Higher volume in the aftermarket business, driven by positive market trends and the impact of expanded market share, is expected to have driven the performance of the Mobile Solutions segment. However, softness in agriculture markets within the Off-Road business and decrease in global truck production within the On-Road business are expected to have partially dented the segment’s performance. The consensus estimate for the segment’s revenues stands at $578 million. While this represents a 1.2% decline from the same quarter last year, it marks a 5.5% improvement over the previous quarter.

In August 2024, Donaldson acquired a 49% minority stake in Medica S.p.A. which enabled it to penetrate new markets and diversify its offerings in the medical device and water purification sectors. This is expected to support its fiscal third-quarter results.

The Zacks Consensus Estimate for the company’s revenues is pegged at $940.5 million, which implies an increase of 1.4% from the year-ago quarter’s reported figure. The consensus estimate for adjusted earnings is pinned at 95 cents per share, indicating a 3.3% increase from the year-ago quarter’s reported number.

However, the escalating selling, general and administrative (SG&A) expenses pose a threat to DCI’s bottom line. Increasing headcount and incremental expenses associated with investments in acquired businesses are expected to have pushed up the SG&A expenses, which are likely to have impacted Donaldson’s margins in the fiscal third quarter.

Donaldson Company, Inc. Price and EPS Surprise

Donaldson Company, Inc. Price and EPS Surprise

Donaldson Company, Inc. price-eps-surprise | Donaldson Company, Inc. Quote

Earnings Whispers

Our proven model predicts an earnings beat for DCI this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here, as elaborated below. 

Earnings ESP: DCI has an Earnings ESP of +3.74% as the Most Accurate Estimate is pegged at 99 cents per share, which is higher than the Zacks Consensus Estimate of 95 cents. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: DCI currently carries a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Performance of Other Companies

AZZ Inc. (AZZ - Free Report) came out with quarterly earnings of 98 cents per share in the second quarter of fiscal 2025 (ended February 2025), beating the Zacks Consensus Estimate of 95 cents. This compares with earnings of 93 cents per share a year ago.

AZZ reported revenues of $351.9 million, missing the consensus estimate by 3.8%. This compares with year-ago revenues of $366.5 million. 

Valmont Industries (VMI - Free Report) reported revenues of $969.3 million in the first quarter of 2025, declining 0.9% on a year-over-year basis. Earnings per share of $4.32 remained flat year over year.

The reported revenues compare with the Zacks Consensus Estimate of $975.6 million. The company delivered an earnings surprise of 1.89%, with the consensus estimate being $4.24 per share.

Pentair plc (PNR - Free Report) came out with quarterly earnings of $1.11 per share in the first quarter of 2025, beating the Zacks Consensus Estimate of $1.01. This compares with earnings of 94 cents per share a year ago.

Pentair reported revenues of $1.01 billion for the quarter, surpassing the consensus estimate by 2.7%. This compares with year-ago revenues of $1.02 billion.

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