Back to top

Image: Bigstock

Barnes' (B) Gimatic Buyout in Q4 to Aid Industrial Segment

Read MoreHide Full Article

Barnes Group Inc. (B - Free Report) has announced that it will acquire Brescia, Italy-based Gimatic S.r.l. from its founders as well as certain investment funds related to Xenon Capital Partners and AGIC Capital. The transaction value has been fixed at €370 million in cash.

Gimatic, a privately-owned company, specializes in supplying essential solutions for use in robotic and industrial automation industries. Its offerings include sensors, robotic grippers, sophisticated end-of-arm tooling systems and many automation components. The firm has operations extended to Asia, North America and Europe.

Details of Buyout

Barnes intends to fund the transaction with available cash and money raised under the prevalent credit facilities.

Per the agreement, Barnes will report results of Gimatic under its Industrial segment. The acquired assets, which will work as a new unit under the segment, will enable the company to leverage benefits from the rising use of robotics technology in industrial applications.

The buyout will likely be completed in the fourth quarter of 2018.

Barnes’ Buyout Strategies

The above-mentioned transaction is consistent with Barnes’ policy of acquiring businesses to gain access to new markets and improve product lines.

Earlier, in July 2018, Barnes acquired U.K.-based Industrial Gas Springs Group Holdings Limited. The acquired business, dealing in customized gas springs, was added to the Industrial segment’s Nitrogen Gas Products business.

It’s worth mentioning here that Barnes anticipates the Industrial segment’s sales to grow in low-single to mid-single digit in 2018. Total revenues are projected to increase 5-6%, including 1% contribution from acquired assets.

Zacks Rank & Other Stocks to Consider

With a market capitalization of nearly $3.7 billion, Barnes currently carries a Zacks Rank #2 (Buy). Its investment appeal is further accentuated by a favorable VGM Score of B.

We believe market sentiments are currently favoring the stock. In the past three months, Barnes’ share has yielded 20.7% return, outperforming 13% increase recorded by the industry.

Further, in the past 60 days, earnings estimates on Barnes for both 2018 and 2019 have been increased by four brokerage firms. Currently, the Zacks Consensus Estimate is pegged at $3.26 for 2018 and $3.51 for 2019, reflecting growth of 5.2% and 3.2% from the respective 60-day-ago tallies.

Barnes Group, Inc. Price and Consensus


Other top-ranked stocks in the industry are Altra Industrial Motion Corp. AIMC, Colfax Corporation CFX and DXP Enterprises, Inc. DXPE. All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the last 60 days, earnings estimates for each of these stocks have improved for the current year. Moreover, average positive earnings surprise for the last four quarters has been 4.01% for Altra Industrial Motion, 7.91% for Colfax and 101.32% for DXP Enterprises.

Looking for Stocks with Skyrocketing Upside?

Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.

Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.

See the pot trades we're targeting>>

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Barnes Group, Inc. (B) - free report >>

Published in