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Reasons that Make Dover (DOV) a Solid Investment Choice
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Dover Corporation (DOV - Free Report) looks promising at the moment on the back of an upbeat outlook, focus on the Wellsite business spin-off and significant drilling activity. We are optimistic on the company’s prospects and believe this is the right time to add the stock to your portfolio, as it is poised to carry the bullish momentum ahead.
Let's delve deeper and analyze the factors that make this industrial products and manufacturing equipment maker an attractive investment option.
The company also has a Value Growth Momentum Score (VGM Score) of B. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or #2, offer the best investment opportunities. Thus, the company appears to be a potential investment proposition at the moment.
Above the Industry: Over the past year, Dover has outperformed the industry it belongs to. The company’s shares have jumped around 15% compared with 14% growth recorded by the industry during the same time frame.
Upward Estimate Revisions: The Zacks Consensus Estimate for earnings per share for 2018 has surged 30% to $2.09 in the last 90 days. The same for 2019 has gone up 25% to $6.42 in the same time period.
Positive Earnings Surprise History: Dover has an impressive earnings surprise history. It outpaced the Zacks Consensus Estimate over the trailing four quarters, delivering an average positive earnings surprise of 7.26%.
Strong Q4 Results: Dover’s fourth-quarter 2017 earnings and revenues climbed 49% and 13%, respectively, on a year-over-year basis, and also beat the respective Zacks Consensus Estimate. The stellar performance was driven by strong global markets, along with cost and productivity improvements.
Upbeat Guidance: For 2018, Dover guided earnings per share in the range of $5.73-$5.93. The mid-point of the earnings guidance range reflects year-over-year growth of 19%. The company expects adjusted segment margin to expand 110 basis points to approximately 15.3% from 2017 levels. Dover’s results will witness positive impact of the enactment of the Tax Cuts and Jobs Act.
In addition, sound growth in the Pumps, and hygienic and pharma businesses, as well as improved productivity, especially within the retail refrigeration business will stoke Dover’s growth.
Commercial excellence programs, productivity and retail fueling integration will continue to drive margin expansion. Moreover, its Energy businesses are likely to witness double-digit growth as a result of volume leverage.
Growth Drivers in Place: In December 2017, Dover decided to spin-off its Wellsite business into a stand-alone, publicly-traded company in order to simplify its portfolio. The action will separate the company’s upstream energy businesses in the Energy segment, which includes Dover Artificial Lift, Dover Energy Automation, and US Synthetic. This will help Dover focus on its less volatile core platforms. The company expects the transaction to close by May 2018, subject to certain customary conditions.
Further, Dover’s significant drilling activity over the last few quarters has created a large backlog of drilled but incomplete wells. The company anticipates that many of these wells will be completed over the coming quarters, consequently driving performance.
Other Stocks to Consider
Some other similarly-ranked stocks as Dover in the sector include Barnes Group, Inc. (B - Free Report) , EnPro Industries (NPO - Free Report) and Graco Inc. (GGG - Free Report) .
Barnes Group has long-term earnings growth rate of 10%. Its shares rallied 17.6% over the past year.
EnPro Industries has long-term earnings growth rate of 22.3%. Its shares increased 12.6% in the last year.
Graco has long-term earnings growth rate of 10.5%. The stock has appreciated 43% in a year’s time.
Zacks Editor-in-Chief Goes "All In" on This Stock
Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.
Image: Bigstock
Reasons that Make Dover (DOV) a Solid Investment Choice
Dover Corporation (DOV - Free Report) looks promising at the moment on the back of an upbeat outlook, focus on the Wellsite business spin-off and significant drilling activity. We are optimistic on the company’s prospects and believe this is the right time to add the stock to your portfolio, as it is poised to carry the bullish momentum ahead.
Let's delve deeper and analyze the factors that make this industrial products and manufacturing equipment maker an attractive investment option.
What's Working in Favor of Dover?
Solid Rank & VGM Score: Dover currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The company also has a Value Growth Momentum Score (VGM Score) of B. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or #2, offer the best investment opportunities. Thus, the company appears to be a potential investment proposition at the moment.
Above the Industry: Over the past year, Dover has outperformed the industry it belongs to. The company’s shares have jumped around 15% compared with 14% growth recorded by the industry during the same time frame.
Upward Estimate Revisions: The Zacks Consensus Estimate for earnings per share for 2018 has surged 30% to $2.09 in the last 90 days. The same for 2019 has gone up 25% to $6.42 in the same time period.
Positive Earnings Surprise History: Dover has an impressive earnings surprise history. It outpaced the Zacks Consensus Estimate over the trailing four quarters, delivering an average positive earnings surprise of 7.26%.
Strong Q4 Results: Dover’s fourth-quarter 2017 earnings and revenues climbed 49% and 13%, respectively, on a year-over-year basis, and also beat the respective Zacks Consensus Estimate. The stellar performance was driven by strong global markets, along with cost and productivity improvements.
Upbeat Guidance: For 2018, Dover guided earnings per share in the range of $5.73-$5.93. The mid-point of the earnings guidance range reflects year-over-year growth of 19%. The company expects adjusted segment margin to expand 110 basis points to approximately 15.3% from 2017 levels. Dover’s results will witness positive impact of the enactment of the Tax Cuts and Jobs Act.
In addition, sound growth in the Pumps, and hygienic and pharma businesses, as well as improved productivity, especially within the retail refrigeration business will stoke Dover’s growth.
Commercial excellence programs, productivity and retail fueling integration will continue to drive margin expansion. Moreover, its Energy businesses are likely to witness double-digit growth as a result of volume leverage.
Growth Drivers in Place: In December 2017, Dover decided to spin-off its Wellsite business into a stand-alone, publicly-traded company in order to simplify its portfolio. The action will separate the company’s upstream energy businesses in the Energy segment, which includes Dover Artificial Lift, Dover Energy Automation, and US Synthetic. This will help Dover focus on its less volatile core platforms. The company expects the transaction to close by May 2018, subject to certain customary conditions.
Further, Dover’s significant drilling activity over the last few quarters has created a large backlog of drilled but incomplete wells. The company anticipates that many of these wells will be completed over the coming quarters, consequently driving performance.
Other Stocks to Consider
Some other similarly-ranked stocks as Dover in the sector include Barnes Group, Inc. (B - Free Report) , EnPro Industries (NPO - Free Report) and Graco Inc. (GGG - Free Report) .
Barnes Group has long-term earnings growth rate of 10%. Its shares rallied 17.6% over the past year.
EnPro Industries has long-term earnings growth rate of 22.3%. Its shares increased 12.6% in the last year.
Graco has long-term earnings growth rate of 10.5%. The stock has appreciated 43% in a year’s time.
Zacks Editor-in-Chief Goes "All In" on This Stock
Full disclosure, Kevin Matras now has more of his own money in one particular stock than in any other. He believes in its short-term profit potential and also in its prospects to more than double by 2019. Today he reveals and explains his surprising move in a new Special Report.
Download it free >>